Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 12, 2020 | Jun. 30, 2019 | |
Cover page. | |||
Title of 12(b) Security | Common Stock, no par value | ||
Trading Symbol | YUM | ||
Security Exchange Name | NYSE | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Type | 10-K | ||
Entity File Number | 1-13163 | ||
Entity Registrant Name | YUM! BRANDS, INC. | ||
Entity Incorporation, State or Country Code | NC | ||
Entity Tax Identification Number | 13-3951308 | ||
Entity Address, Address Line One | 1441 Gardiner Lane, | ||
Entity Address, City or Town | Louisville, | ||
Entity Address, State or Province | KY | ||
Entity Address, Postal Zip Code | 40213 | ||
City Area Code | (502) | ||
Local Phone Number | 874-8300 | ||
Entity Interactive Data Current | Yes | ||
Entity Current Reporting Status | Yes | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2019 | ||
Entity Central Index Key | 0001041061 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 33,600,000,000 | ||
Entity Common Stock, Shares Outstanding | 300,822,322 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Millions | 12 Months Ended | |||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||||
Other Operating Income (Expense), Net | $ (4) | $ (7) | $ (10) | |||
Revenues | ||||||
Total revenues | 5,597 | 5,688 | 5,878 | |||
Costs and Expenses, Net | ||||||
Cost of Goods and Services Sold | 1,235 | 1,634 | 2,954 | |||
General and administrative expenses | 917 | 895 | 999 | |||
Franchisor Costs | 180 | 188 | 237 | |||
Cooperative Advertising Expense | 1,368 | 1,208 | 0 | |||
Closures and impairment (income) expenses | 5 | 6 | 3 | |||
Operating Expenses | 3,667 | 3,392 | 3,117 | |||
Operating Profit | 1,930 | [1] | 2,296 | [2] | 2,761 | |
Investment Income, Net | [3] | 67 | (9) | (5) | ||
Other Pension (income) expense | [3],[4] | 4 | 14 | 47 | ||
Interest Income (Expense), Net | [3] | (486) | (452) | (445) | ||
Income (Loss), Including Portion Attributable to Noncontrolling Interest, before Tax | 1,373 | 1,839 | 2,274 | |||
Income tax provision | 79 | 297 | 934 | |||
Income from continuing operations | 1,294 | |||||
Net Income | $ 1,294 | $ 1,542 | $ 1,340 | |||
Basic Earnings Per Common Share (in dollars per share) | $ 4.23 | $ 4.80 | $ 3.86 | |||
Diluted Earnings Per Common Share (in dollars per share) | 4.14 | 4.69 | 3.77 | |||
Dividends Declared Per Common Share (in dollars per share) | $ 1.68 | $ 1.44 | $ 0.90 | |||
Product [Member] | ||||||
Revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 1,546 | $ 2,000 | $ 3,572 | |||
Franchise and property revenue [Member] | ||||||
Revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 2,660 | 2,482 | 2,306 | |||
Advertising [Member] | ||||||
Revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 1,391 | $ 1,206 | $ 0 | |||
[1] | Includes net gains from refranchising initiatives of $6 million , $4 million , $8 million and $19 million in the first, second, third and fourth quarters, respectively. | |||||
[2] | Includes net gains from refranchising initiatives of $156 million , $29 million , $100 million and $255 million in the first, second, third and fourth quarters, respectively. | |||||
[3] | Amounts have not been allocated to any segment for performance reporting purposes. | |||||
[4] | Amounts in 2017 include a non-cash charge of $22 million related to the adjustment of certain historical deferred vested liability balances in our qualified U.S. plan. See Note 4. |
Consolidated Statement of Compr
Consolidated Statement of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Net Income (loss) - YUM! Brands, Inc. | $ 1,294 | $ 1,542 | $ 1,340 |
Adjustments and gains (losses) arising during the year | 28 | (94) | 115 |
Reclassifications of adjustments and (gains) losses into Net Income | 0 | (4) | 55 |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, before Tax | 28 | (98) | 170 |
Tax (expense) benefit | (4) | 6 | (8) |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | 24 | (92) | 162 |
Unrealized gains (losses) arising during the year | (39) | 32 | (17) |
Reclassification of (gains) losses into Net Income | 10 | 22 | 52 |
Other Comprehensive (Income) Loss, Pension and Other Postretirement Benefit Plans, Unrealized Gains (Losses), before Tax | (29) | 54 | 35 |
Tax (expense) benefit | 7 | (13) | (14) |
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax | (22) | 41 | 21 |
Unrealized gains (losses) arising during the year | (51) | 19 | (52) |
Reclassification of (gains) losses into Net Income | (25) | (39) | 58 |
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, before Tax | (76) | (20) | 6 |
Tax (expense) benefit | 20 | 6 | (2) |
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax | (56) | (14) | 4 |
Other Comprehensive Income (Loss), Net of Tax | (54) | (65) | 187 |
Comprehensive Income - Yum! Brands, Inc. | $ 1,240 | $ 1,477 | $ 1,527 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | $ 768 | $ 474 | $ 1,599 | |
Cash Flows - Operating Activities | ||||
Net Income | 1,294 | 1,542 | 1,340 | |
Depreciation and amortization | 112 | 137 | 253 | |
Closures and impairment (income) expenses | 5 | 6 | 3 | |
Contributions to defined benefit pension plans | (15) | (16) | (55) | |
Deferred Income Tax Expense (Benefit) | (232) | (11) | 634 | |
Share-based compensation expense | 59 | 50 | 65 | |
Changes in accounts payable and other current liabilities | (36) | (68) | (173) | |
Increase (Decrease) in Prepaid Expense and Other Assets | 8 | 0 | 10 | |
Changes in income taxes payable | 23 | 65 | (55) | |
Increase (Decrease) in Accounts and Notes Receivable | 56 | 66 | 19 | |
Other, net | 144 | 92 | 138 | |
Net Cash Provided by Operating Activities | 1,315 | 1,176 | 1,030 | |
Cash Flows - Investing Activities | ||||
Capital spending | (196) | (234) | (318) | |
Payments to Acquire Businesses, Net of Cash Acquired | 0 | (66) | 0 | |
Payments to Acquire Investments | 0 | (200) | 0 | |
Proceeds from refranchising of restaurants | 110 | 825 | 1,773 | |
Other, net | (2) | (12) | 17 | |
Net Cash Used in Investing Activities | (88) | 313 | 1,472 | |
Cash Flows - Financing Activities | ||||
Proceeds from long-term debt | 800 | 1,556 | 1,088 | |
Repayments of long-term debt | (331) | (1,264) | (385) | |
Revolving credit facilities, three months or less, net | 0 | 0 | 0 | |
Short-term borrowings by original maturity | ||||
More than three months - proceeds | 130 | 59 | 0 | |
More than three months - payments | (126) | (59) | 0 | |
Three months or less, net | 0 | 0 | 0 | |
Repurchase shares of Common Stock | (815) | (2,390) | (1,960) | |
Dividends paid on Common Stock | (511) | (462) | (416) | |
Debt issuance costs | (10) | (13) | (32) | |
Other, net | (75) | (47) | (90) | |
Net Cash Used in Financing Activities | (938) | (2,620) | (1,795) | |
Effect of Exchange Rate on Cash and Cash Equivalents | 5 | (63) | 61 | |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Including Exchange Rate Effect | 294 | (1,194) | 768 | |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents - End of Year | [1] | $ 768 | $ 474 | $ 1,599 |
[1] | Upon adoption of Topic 606 we reclassified cash of $11 million and restricted cash of $58 million , respectively, from Advertising cooperative assets, restricted to Cash and cash equivalents and Prepaid expenses and other current assets. These amounts are included in the Beginning of Year balance of Cash, Cash Equivalents, Restricted Cash and Restricted Cash equivalents in our Consolidated Statement of Cash Flows for the year ended December 31, 2018. |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | |
Current Assets | |||
Cash and cash equivalents | $ 605 | $ 292 | |
Accounts and notes receivable, net | 584 | 561 | |
Prepaid Expense and Other Assets, Current | 338 | 354 | |
Total Current Assets | 1,527 | 1,207 | |
Property, Plant and equipment, net | 1,170 | 1,237 | |
Goodwill | [1] | 530 | 525 |
Intangible assets, net | 244 | 242 | |
Other assets | 1,313 | 724 | |
Deferred income taxes | 447 | 195 | |
Total Assets | [2] | 5,231 | 4,130 |
Current Liabilities | |||
Accounts payable and other current liabilities | 960 | 911 | |
Income taxes payable | 150 | 69 | |
Short-term borrowings | 431 | 321 | |
Total Current Liabilities | 1,541 | 1,301 | |
Long-term debt | 10,131 | 9,751 | |
Other liabilities and deferred credits | 1,575 | 1,004 | |
Total Liabilities | 13,247 | 12,056 | |
Shareholders' Equity | |||
Common stock, no par value, 750 shares authorized; 332 shares and 355 shares issued in 2017 and 2016, respectively | 0 | 0 | |
Retained Earnings (Accumulated Deficit) | (7,628) | (7,592) | |
Accumulated other comprehensive income (loss) | (388) | (334) | |
Total Shareholders' Equity | (8,016) | (7,926) | |
Total Liabilities, Redeemable Noncontrolling Interest and Shareholders' Equity | $ 5,231 | $ 4,130 | |
[1] | Goodwill, net includes $17 million of accumulated impairment losses for each year presented related to our Pizza Hut segment. | ||
[2] | U.S. identifiable assets included in the combined Corporate and KFC, Pizza Hut and Taco Bell Divisions totaled $2.7 billion and $2.0 billion in 2019 and 2018, respectively. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Millions, $ / shares in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Shareholders' Equity (Deficit) | ||
Common Stock, par value | $ 0 | $ 0 |
Common Stock, shares authorized | 750 | 750 |
Common Stock, shares issued | 300 | 306 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) shares in Thousands, $ in Millions | Total | Common Stock | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Permanent Equity | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Shareholders' Equity [Member] (Deprecated 2019-01-31)Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | |
Balance at Dec. 31, 2016 | $ 0 | $ (5,157) | $ (458) | $ (5,615) | ||||
Balance (in shares) at Dec. 31, 2016 | 355,000 | |||||||
Net Income (loss) - YUM! Brands, Inc. | $ 1,340 | 1,340 | ||||||
Net Income (loss) - including noncontrolling interest | 1,340 | |||||||
Translation adjustments and gains (losses) from intra-entity transactions of a long-term investment nature (net of tax impact) | 107 | |||||||
Translation adjustments and gains (losses) from intra-entity transactions of a long-term investment nature - including noncontrolling interest (net of tax impact) | 107 | |||||||
Reclassifications of adjustments and (gains) losses into Net Income | 55 | 55 | 55 | |||||
Pension and post-retirement benefit plans (net of tax impact) | 21 | 21 | 21 | |||||
Net unrealized gain (loss) on derivative instruments (net of tax impact) | 4 | 4 | ||||||
Comprehensive income - including noncontrolling interests | 1,527 | |||||||
Dividends declared | (311) | (311) | ||||||
Repurchase of shares of Common Stock | $ (1,915) | [1] | $ 0 | (1,915) | (1,915) | |||
Repurchase of shares of Common Stock (in shares) | (26,561) | [1] | (27,000) | |||||
Employee stock option and SARs exercises (includes tax impact) | $ 58 | (20) | 78 | |||||
Employee stock option and SARs exercises (in shares) | 4,000 | |||||||
Compensation-related events (includes tax impact) | $ 58 | 58 | ||||||
Balance at Dec. 31, 2017 | $ 0 | (6,063) | (271) | (6,334) | ||||
Balance (in shares) at Dec. 31, 2017 | 332,000 | |||||||
Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Tax | $ (8) | |||||||
Other Comprehensive Income (Loss), Foreign Currency Translation Reclassification Adjustment from AOCI, Tax | 0 | |||||||
Pension and post-retirement benefit plans (tax impact) | (14) | |||||||
Employee Stock Option And SARs Exercises Value, Tax | 0 | |||||||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Tax | (2) | |||||||
Net Income (loss) - YUM! Brands, Inc. | 1,542 | 1,542 | $ 11 | |||||
Net Income (loss) - including noncontrolling interest | 1,542 | |||||||
Translation adjustments and gains (losses) from intra-entity transactions of a long-term investment nature (net of tax impact) | (88) | |||||||
Translation adjustments and gains (losses) from intra-entity transactions of a long-term investment nature - including noncontrolling interest (net of tax impact) | (88) | |||||||
Reclassifications of adjustments and (gains) losses into Net Income | (4) | (4) | (4) | |||||
Pension and post-retirement benefit plans (net of tax impact) | 41 | 41 | 41 | |||||
Net unrealized gain (loss) on derivative instruments (net of tax impact) | (14) | (14) | ||||||
Comprehensive income - including noncontrolling interests | 1,477 | |||||||
Dividends declared | (464) | (464) | ||||||
Repurchase of shares of Common Stock | $ (2,394) | [2] | $ (38) | (2,356) | (2,394) | |||
Repurchase of shares of Common Stock (in shares) | (28,243) | [2] | (28,000) | |||||
Employee stock option and SARs exercises (includes tax impact) | $ 41 | 41 | ||||||
Employee stock option and SARs exercises (in shares) | 2,000 | |||||||
Compensation-related events (includes tax impact) | $ 79 | 79 | ||||||
Balance at Dec. 31, 2018 | $ (7,926) | $ 0 | (7,592) | (334) | (7,926) | |||
Balance (in shares) at Dec. 31, 2018 | 306,000 | |||||||
Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Tax | 6 | |||||||
Pension and post-retirement benefit plans (tax impact) | (13) | |||||||
Employee Stock Option And SARs Exercises Value, Tax | 0 | |||||||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Tax | 6 | |||||||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | 2 | |||||||
Retained Earnings (Accumulated Deficit) | 7,592 | (251) | ||||||
Stockholders' Equity Attributable to Parent | 231 | $ (249) | ||||||
Net Income (loss) - YUM! Brands, Inc. | 1,294 | 1,294 | ||||||
Net Income (loss) - including noncontrolling interest | 1,294 | |||||||
Translation adjustments and gains (losses) from intra-entity transactions of a long-term investment nature (net of tax impact) | 24 | |||||||
Translation adjustments and gains (losses) from intra-entity transactions of a long-term investment nature - including noncontrolling interest (net of tax impact) | 24 | |||||||
Reclassifications of adjustments and (gains) losses into Net Income | 0 | |||||||
Pension and post-retirement benefit plans (net of tax impact) | (22) | (22) | (22) | |||||
Net unrealized gain (loss) on derivative instruments (net of tax impact) | (56) | (56) | ||||||
Comprehensive income - including noncontrolling interests | 1,240 | |||||||
Dividends declared | (514) | (514) | ||||||
Repurchase of shares of Common Stock | $ (810) | [2] | $ (14) | (796) | (810) | |||
Repurchase of shares of Common Stock (in shares) | (7,788) | [2] | (8,000) | |||||
Employee stock option and SARs exercises (includes tax impact) | $ 57 | (18) | 75 | |||||
Employee stock option and SARs exercises (in shares) | 2,000 | |||||||
Compensation-related events (includes tax impact) | $ 71 | 71 | ||||||
Balance at Dec. 31, 2019 | $ (8,016) | $ 0 | $ (7,628) | $ (388) | $ (8,016) | |||
Balance (in shares) at Dec. 31, 2019 | 300,000 | |||||||
Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Tax | (4) | |||||||
Pension and post-retirement benefit plans (tax impact) | 7 | |||||||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Tax | 20 | |||||||
Retained Earnings (Accumulated Deficit) | $ 7,628 | $ (2) | ||||||
[1] | 2017 amount excludes the effect of $45 million in share repurchases ( 0.7 million shares) with trade dates prior to December 31, 2016 but settlement dates subsequent to December 31, 2016. | |||||||
[2] | 2019 amount excludes and 2018 amount includes the effect of $5 million in share repurchases ( 0.1 million shares) with trade dates on, or prior to, December 31, 2018 but settlement dates subsequent to December 31, 2018. |
Consolidated Statements of Sh_2
Consolidated Statements of Shareholders' Equity (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement of Stockholders' Equity [Abstract] | |||
Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Tax | $ (4) | $ 6 | $ (8) |
Other Comprehensive Income (Loss), Foreign Currency Translation Reclassification Adjustment from AOCI, Tax | 0 | ||
Pension and post-retirement benefit plans (tax impact) | 7 | (13) | (14) |
Employee Stock Option And SARs Exercises Value, Tax | 0 | 0 | |
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Tax | $ 20 | $ 6 | $ (2) |
Description of Business
Description of Business | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business Yum! Brands, Inc. and its Subsidiaries (collectively referred to herein as the “Company,” “YUM,” “we,” “us” or “our”) franchises or operates a system of over 50,000 quick service restaurants in more than 150 countries and territories. At December 31, 2019, 98% of these restaurants were owned and operated by franchisees. The Company’s KFC, Pizza Hut and Taco Bell brands (collectively the “Concepts”) are global leaders of the chicken, pizza and Mexican-style food categories. Through our widely-recognized Concepts, we develop, operate or franchise a system of both traditional and non-traditional quick service restaurants. The terms "franchise" or "franchisee" within these Consolidated Financial Statements are meant to describe third parties that operate units under either franchise or license agreements. Our traditional restaurants feature dine-in, carryout and, in some instances, drive-thru or delivery service. Non-traditional units include express units and kiosks which have a more limited menu and operate in non-traditional locations like malls, airports, gasoline service stations, train stations, subways, convenience stores, stadiums, amusement parks and colleges, where a full-scale traditional outlet would not be practical or efficient. We also operate or franchise multibrand units, where two or more of our Concepts are operated in a single unit. As of December 31, 2019 , YUM consisted of three operating segments: • The KFC Division which includes our worldwide operations of the KFC concept • The Pizza Hut Division which includes our worldwide operations of the Pizza Hut concept • |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Our preparation of the accompanying Consolidated Financial Statements in conformity with Generally Accepted Accounting Principles in the United States of America (“GAAP”) requires us to make estimates and assumptions that affect reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Principles of Consolidation and Basis of Preparation. Intercompany accounts and transactions have been eliminated in consolidation. We consolidate entities in which we have a controlling financial interest, the usual condition of which is ownership of a majority voting interest. We also consider for consolidation an entity, in which we have certain interests, where the controlling financial interest may be achieved through arrangements that do not involve voting interests. Such an entity, known as a variable interest entity (“VIE”), is required to be consolidated by its primary beneficiary. The primary beneficiary is the entity that possesses the power to direct the activities of the VIE that most significantly impact its economic performance and has the obligation to absorb losses or the right to receive benefits from the VIE that are significant to it. Our most significant variable interests are in entities that operate restaurants under our Concepts’ franchise and license arrangements. We do not have an equity interest in any of our franchisee businesses except for a minority interest in an entity that owns our KFC Brazil and Pizza Hut Brazil master franchisee rights. This minority interest does not give us the ability to significantly influence the franchisee. Additionally, we do not typically provide significant financial support such as loans or guarantees to our franchisees. However, we do have variable interests in certain franchisees through real estate lease arrangements to which we are a party. At the end of 2019 , YUM has future lease payments due from franchisees, on a nominal basis, of approximately $1 billion , and we are secondarily liable on certain other lease agreements that have been assigned to franchisees. See the Lease Guarantees section in Note 19. As our franchise arrangements provide our franchisee entities the power to direct the activities that most significantly impact their economic performance, we do not consider ourselves the primary beneficiary of any such entity that might otherwise be considered a VIE. We participate in various advertising cooperatives with our franchisees, typically within a country where we have both Company-owned restaurants and franchise restaurants, established to collect and administer funds contributed for use in advertising and promotional programs designed to increase sales and enhance the reputation of the Company and our Concepts. Contributions to the advertising cooperatives are required for both Company-owned and franchise restaurants and are generally based on a percentage of restaurant sales. We maintain certain variable interests in these cooperatives. As the cooperatives are required to spend all funds collected on advertising and promotional programs, total equity at risk is not sufficient to permit the cooperatives to finance their activities without additional subordinated financial support. Therefore, these cooperatives are VIEs. As a result of our voting rights, we consolidate certain of these cooperatives for which we are the primary beneficiary. Fiscal Year. YUM's fiscal year begins on January 1 and ends December 31 of each year, with each quarter comprised of three months. Our U.S. subsidiaries and certain international subsidiaries operate on a weekly periodic calendar where the first three quarters of each fiscal year consists of 12 weeks and the fourth quarter consists of 16 weeks in fiscal years with 52 weeks and 17 weeks in fiscal years with 53 weeks. Our remaining international subsidiaries operate on a monthly calendar similar to that on which YUM operates. Fiscal year 2019 included 53 weeks for our U.S. businesses and for our international subsidiaries that reported on a period calendar. The 53 rd week added $66 million to Total revenues, $24 million to Operating Profit and $17 million to Net Income in our 2019 Consolidated Statement of Income. On January 27, 2017, YUM’s Board of Directors approved a change in the Company's fiscal year from a year ending on the last Saturday of December to a year beginning on January 1 and ending December 31 of each year, commencing with the year ending December 31, 2017. In connection with this change, the Company moved from a 52-week periodic fiscal calendar with three 12 -week interim quarters and a 16 -week fourth quarter to a monthly reporting calendar with each quarter comprised of three months. Our U.S. subsidiaries continue to report on a period calendar as described above. Concurrent with the change in the Company's fiscal year, we also eliminated the one month or one period reporting lags of our international subsidiaries. As a result of removing these reporting lags, each international subsidiary operates either on a monthly calendar consistent with the Company’s new calendar or on a periodic calendar consistent with our U.S. subsidiaries. We believe this change in our international subsidiary reporting calendars and the resulting elimination of reporting lags is preferable because a more current reporting calendar allows the Consolidated Financial Statements to more consistently and more timely reflect the impact of current events, economic conditions and global trends. The change to the Company’s fiscal year and removal of the international reporting lags became effective beginning in 2017. We applied this change in accounting principle retrospectively to financial periods presented prior to 2017. Our next fiscal year scheduled to include a 53rd week is 2024. Foreign Currency. The functional currency of our foreign entities is the currency of the primary economic environment in which the entity operates. Functional currency determinations are made based upon a number of economic factors, including but not limited to cash flows and financing transactions. The operations, assets and liabilities of our entities outside the U.S. are initially measured using the functional currency of that entity. Income and expense accounts for our operations of these foreign entities are then translated into U.S. dollars at the average exchange rates prevailing during the period. Assets and liabilities of these foreign entities are then translated into U.S. dollars at exchange rates in effect at the balance sheet date. As of December 31, 2019 , net cumulative translation adjustment losses of $221 million are recorded in Accumulated other comprehensive loss ("AOCI") in the Consolidated Balance Sheet. The majority of our foreign currency net asset exposure is in countries where we have Company-owned restaurants. As we manage and share resources at the individual brand level within a country, cumulative translation adjustments are recorded and tracked at the foreign-entity level that represents the operations of our individual brands within that country. Translation adjustments recorded in AOCI are subsequently recognized as income or expense generally only upon sale of the related investment in a foreign entity, or upon a sale of assets and liabilities within a foreign entity that represents a complete or substantially complete liquidation of that foreign entity. For purposes of determining whether a sale or complete or substantially complete liquidation of an investment in a foreign entity has occurred, we consider those same foreign entities for which we record and track cumulative translation adjustments. Gains and losses arising from the impact of foreign currency exchange rate fluctuations on transactions in foreign currency are included in Other (income) expense in our Consolidated Statements of Income. Reclassifications. We have reclassified certain items in the Consolidated Financial Statements for prior periods to be comparable with the classification for the fiscal year ended December 31, 2019 . These reclassifications had no effect on previously reported Net Income. Revenue Recognition. From 2014 through 2017, the Financial Accounting Standards Board ("FASB") issued standards to provide principles within a single framework for revenue recognition of transactions involving contracts with customers across all industries ("Topic 606"). We adopted Topic 606 at the beginning of the year ended December 31, 2018. Below is a discussion of how our revenues are earned, our accounting policies pertaining to revenue recognition prior to the adoption of Topic 606 ("Legacy Revenue GAAP"), our accounting policies pertaining to revenue recognition subsequent to the adoption of Topic 606 and other required disclosures. Refer to Note 4 for information regarding the cumulative effect adjustment recorded to Accumulated deficit as of the beginning of the year ended December 31, 2018 to reflect the adoption of Topic 606. Also included in Note 4 is disclosure of the amount by which each balance sheet and income statement line item was impacted in 2018 as compared to Legacy Revenue GAAP. Company Sales Revenues from the sale of food items by Company-owned restaurants are recognized as Company sales when a customer purchases the food, which is when our obligation to perform is satisfied. The timing and amount of revenue recognized related to Company sales was not impacted by the adoption of Topic 606. Franchise and Property Revenues Franchise Revenues Our most significant source of revenues arises from the operation of our Concepts' stores by our franchisees. Franchise rights may be granted through a store-level franchise agreement or through a master franchise agreement that sets out the terms of our arrangement with the franchisee. Our franchise agreements require that the franchisee remit continuing fees to us as a percentage of the applicable restaurant’s sales in exchange for the license of the intellectual property associated with our Concepts' brands (the “franchise right”). Our franchise agreements also typically require certain, less significant, upfront franchise fees such as initial fees paid upon opening of a store, fees paid to renew the term of the franchise right and fees paid in the event the franchise agreement is transferred to another franchisee. Continuing fees represent the substantial majority of the consideration we receive under our franchise agreements. Continuing fees are typically billed and paid monthly and are usually 4% - 6% for store-level franchise agreements. Master franchise agreements allow master franchisees to operate restaurants as well as sub-franchise restaurants within certain geographic territories. The percentage of sales that we receive for restaurants owned or sub-franchised by our master franchisees as a continuing fee is typically less than the percentage we receive for restaurants operating under a store-level franchise agreement. Upfront franchise fees are typically billed and paid when a new franchise or sub-franchise agreement becomes effective or when an existing agreement is transferred to another franchisee or sub-franchisee. Under Legacy Revenue GAAP, continuing fees were recognized as the related restaurant sales occurred. The timing and amount of revenue recognized related to continuing fees was not impacted by the adoption of Topic 606 based on the application of the sales-based royalty exception within Topic 606. Under Legacy Revenue GAAP, revenue related to initial fees was recognized upon store opening and renewal and transfer fees were recognized when the related agreement became effective. Upon the adoption of Topic 606, we have determined that the services we provide in exchange for these upfront franchise fees, which primarily relate to pre-opening support, are highly interrelated with the franchise right and are not individually distinct from the ongoing services we provide to our franchisees. As a result, upon the adoption of Topic 606, upfront franchise fees are recognized as revenue over the term of each respective franchise or sub-franchise agreement. Revenues for these upfront franchise fees are recognized on a straight-line basis, which is consistent with the franchisee’s or sub-franchisee's right to use and benefit from the intellectual property. Revenues from continuing fees and upfront franchise fees are presented within Franchise and property revenues in our Consolidated Statements of Income. Additionally, from time-to-time we provide non-refundable consideration to franchisees in the form of cash or other incentives (e.g. cash payments to incent new unit openings, free or subsidized equipment, etc.). The Company’s intent in providing such consideration is to drive new unit development or same-store sales growth that will result in higher future revenues for the Company. Under Legacy Revenue GAAP, this consideration was recognized when we were obligated to provide the incentive and was presented as either a reduction to Franchise and property revenues, if cash was provided directly to the franchisee, or as Franchise and property expenses, if cash was not provided directly to the franchisee. Due to the adoption of Topic 606, such payments are capitalized and presented within Prepaid expense and other current assets or Other assets. These assets are being amortized as a reduction in Franchise and property revenues over the period of expected cash flows from the franchise agreements to which the payment relates. Property Revenues From time to time, we enter into rental agreements with franchisees for the lease or sublease of restaurant locations. These rental agreements typically originate from refranchising transactions and revenues related to the agreements are recognized as they are earned. Amounts owed under the rental agreements are typically billed and paid on a monthly basis. Revenues from rental agreements with franchisees are presented within Franchise and property revenues within our Consolidated Statements of Income. Related expenses are presented as Franchise and property expenses within our Consolidated Statements of Income and primarily include depreciation or, in the case of a sublease, rental expense. The timing and amount of revenue and expenses recognized related to the rental of restaurants we lease or sublease was not impacted by the adoption of Topic 606. Franchise Contributions for Advertising and Other Services Advertising Cooperatives Under Legacy Revenue GAAP, receipts and expenditures related to advertising cooperatives we were required to consolidate were presented on a net basis in our Consolidated Statements of Income and Consolidated Statements of Cash Flows. Additionally, assets and liabilities of the advertising cooperatives we were required to consolidate were presented within Advertising cooperative assets, restricted and Advertising cooperative liabilities, respectively, within our Consolidated Balance Sheets. In accordance with the provisions of Topic 606, we have determined we act as a principal in the transactions entered into by the advertising cooperatives we are required to consolidate based on our responsibility to define the nature of the goods or services provided and/or our responsibility to define which franchisees receive the benefit of the goods or services. Additionally, we have determined the advertising services provided to franchisees are highly interrelated with the franchise right and therefore not distinct. Franchisees remit to these consolidated advertising cooperatives a percentage of restaurant sales as consideration for providing the advertising services. As a result, revenues for advertising services are recognized when the related restaurant sales occur based on the application of the sales-based royalty exception within Topic 606. Revenues for these services are typically billed and received on a monthly basis. These revenues are presented as Franchise contributions for advertising and other services. Expenses incurred to provide these services are presented as Franchise advertising and other services expense. When revenues of an advertising cooperative exceed the related advertising expenses, advertising costs are accrued up to the amount of revenues on an annual basis. Lastly, upon adoption of Topic 606 we have reclassified assets and liabilities of advertising cooperatives we are required to consolidate to the respective balance sheet caption to which the assets and liabilities relate. Other Services On a much more limited basis, we provide goods or services to certain franchisees that are individually distinct from the franchise right because they do not require integration with other goods or services we provide. Such arrangements typically relate to supply chain, quality assurance and information technology services. In instances where we rely on third parties to provide goods or services to franchisees at our direction, we have determined we act as a principal in these transactions. The extent to which we provide such goods or services varies by brand, geographic region and, in some instances, franchisee. Similar to advertising services, receipts and expenditures related to these other services were presented on a net basis under Legacy Revenue GAAP. Upon adoption of Topic 606, revenues from the goods or services described above are presented as Franchise contributions for advertising and other services within our Consolidated Statements of Income. Expenses related to the provisioning of these goods and services are recorded in Franchise advertising and other services expense. These revenues are recognized as the goods or services are transferred to the franchisee and related expenses are recognized as incurred. Franchise Support Costs The internal costs we incur to provide support services to our franchisees for which we do not receive a direct reimbursement are charged to General and administrative expenses (“G&A”) as incurred. Certain direct costs of our franchise operations are charged to Franchise and property expenses. These costs include provisions for estimated uncollectible upfront and continuing fees, rent or depreciation expense associated with restaurants we lease or sublease to franchisees, franchise marketing funding, amortization expense for franchise-related intangible assets, value added taxes on royalties and certain other direct incremental franchise support costs. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue transaction and collected from a customer are excluded from revenue under both Legacy Revenue GAAP and Topic 606. Direct Marketing Costs. To the extent we participate in advertising cooperatives, we expense our contributions as incurred, which are based on a percentage of sales of our Company restaurants. We charge direct marketing costs incurred outside of a cooperative to expense ratably in relation to revenues over the year in which incurred and, in the case of advertising production costs, in the year the advertisement is first shown. Deferred direct marketing costs, which are classified as prepaid expenses, consist of media and related advertising production costs that will generally be used for the first time in the next fiscal year and have historically not been significant. Advertising expenses incurred by our Company-owned restaurants are recorded within Company restaurant expenses and totaled $73 million , $96 million and $179 million in 2019, 2018 and 2017, respectively. Advertising expenses incurred on behalf of franchised restaurants by the Company are recorded within Franchise and property expenses and totaled $10 million , $35 million and $66 million in 2019, 2018 and 2017, respectively. The amounts recorded within Franchise and property expenses include $12.5 million and $25 million related to the Pizza Hut U.S. Transformation Agreement in 2018 and 2017, respectively, and $10 million and $20 million related to the KFC U.S. Acceleration Agreement in 2018 and 2017, respectively. See Note 4 for further discussion of these agreements. In 2019 and 2018 we incurred an additional $1,133 million and $1,035 million , respectively, in spending attributable to franchise contributions to advertising cooperatives that we consolidate and are now reporting on a gross basis within our Consolidated Statements of Income subsequent to the adoption Topic 606. Share-Based Employee Compensation. We recognize ongoing share-based payments to employees, including grants of employee stock options and stock appreciation rights (“SARs”), in the Consolidated Financial Statements as compensation cost over the service period based on their fair value on the date of grant. This compensation cost is recognized over the service period on a straight-line basis, net of an assumed forfeiture rate, for awards that actually vest. Forfeiture rates are estimated at grant date based on historical experience and compensation cost is adjusted in subsequent periods for differences in actual forfeitures from the previous estimates. We present this compensation cost consistent with the other compensation costs for the employee recipient in either Company restaurant expenses or G&A. See Note 15 for further discussion of our share-based compensation plans. Legal Costs. Settlement costs are accrued when they are deemed probable and reasonably estimable. Anticipated legal fees related to self-insured workers' compensation, employment practices liability, general liability, automobile liability, product liability and property losses (collectively, "property and casualty losses") are accrued when deemed probable and reasonably estimable. Legal fees not related to self-insured property and casualty losses are recognized as incurred. See Note 19 for further discussion of our legal proceedings. Impairment or Disposal of Long-Lived Assets. Long-lived assets, including Property, plant and equipment (“PP&E”) as well as right-of-use operating lease assets are tested for impairment whenever events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. The assets are not recoverable if their carrying value is less than the undiscounted cash flows we expect to generate from such assets. If the assets are not deemed to be recoverable, impairment is measured based on the excess of their carrying value over their fair value. For purposes of impairment testing for our restaurants, we have concluded that an individual restaurant is the lowest level of independent cash flows unless it is more likely than not that we will refranchise restaurants as a group. We review our long-lived assets of such individual restaurants (primarily PP&E, right-of-use operating lease assets and allocated intangible assets subject to amortization) that we intend to continue operating as Company restaurants annually for impairment, or whenever events or changes in circumstances indicate that the carrying amount of a restaurant may not be recoverable. We use two consecutive years of operating losses as our primary indicator of potential impairment for our annual impairment testing of these restaurant assets. We evaluate the recoverability of these restaurant assets by comparing the estimated undiscounted future cash flows, which are based on our entity-specific assumptions, to the carrying value of such assets. For restaurant assets that are not deemed to be recoverable, we write-down an impaired restaurant to its estimated fair value, which becomes its new cost basis. Fair value is an estimate of the price a franchisee would pay for the restaurant and its related assets and is determined by discounting the estimated future after-tax cash flows of the restaurant, which include a deduction for royalties we would receive under a franchise agreement with terms substantially at market. The after-tax cash flows incorporate reasonable assumptions we believe a franchisee would make such as sales growth and margin improvement. The discount rate used in the fair value calculation is our estimate of the required rate of return that a franchisee would expect to receive when purchasing a similar restaurant and the related long-lived assets. The discount rate incorporates rates of returns for historical refranchising market transactions and is commensurate with the risks and uncertainty inherent in the forecasted cash flows. Individual restaurant-level impairment is recorded within Other (income) expense. In executing our refranchising initiatives, we most often offer groups of restaurants for sale. When we believe it is more likely than not a restaurant or groups of restaurants will be refranchised for a price less than their carrying value, but do not believe the restaurant(s) have met the criteria to be classified as held for sale, we review the restaurants for impairment. We evaluate the recoverability of these restaurant assets by comparing estimated sales proceeds plus holding period cash flows, if any, to the carrying value of the restaurant or group of restaurants. For restaurant assets that are not deemed to be recoverable, we recognize impairment for any excess of carrying value over the fair value of the restaurants, which is based on the expected net sales proceeds. To the extent ongoing agreements to be entered into with the franchisee simultaneous with the refranchising are expected to contain terms, such as royalty rates, not at prevailing market rates, we consider the off-market terms in our impairment evaluation. We recognize any such impairment charges in Refranchising (gain) loss. Refranchising (gain) loss includes the gains or losses from the sales of our restaurants to new and existing franchisees, including any impairment charges discussed above, and associated termination, relocation or retention costs associated with store-level employees of refranchised stores or employees of restaurant-support centers which we have closed due to refranchising. We recognize gains on restaurant refranchisings when the sale transaction closes and control of the restaurant operations have transferred to the franchisee. When we decide to close a restaurant, it is reviewed for impairment, which includes an estimate of sublease income that could be reasonably obtained, if any, in relation to the right-of-use operating lease asset. Additionally, depreciable lives are adjusted based on the expected disposal date. Other costs incurred when closing a restaurant such as costs of disposing of the assets as well as other facility-related expenses from previously closed stores are generally expensed as incurred. Any costs recorded upon store closure as well as any subsequent adjustments to liabilities for remaining lease obligations as a result of lease termination or changes in estimates of sublease income are recorded in Other (income) expense. To the extent we sell assets, primarily land, associated with a closed store, any gain or loss upon that sale is also recorded in Other (income) expense. Considerable management judgment is necessary to estimate future cash flows, including cash flows from continuing use, terminal value, sublease income and refranchising proceeds. Accordingly, actual results could vary significantly from our estimates. Guarantees. We recognize, at inception of a guarantee, a liability for the fair value of certain obligations undertaken. The majority of our guarantees are issued as a result of assigning our interest in obligations under operating leases as a condition to the refranchising of certain Company restaurants. We recognize a liability for the fair value of such lease guarantees upon refranchising and upon subsequent renewals of such leases when we remain secondarily liable. The related expense and any subsequent changes are included in Refranchising (gain) loss. Any expense and subsequent changes in the guarantees for other franchise support guarantees not associated with a refranchising transaction are included in Franchise and property expenses. Income Taxes. We record deferred tax assets and liabilities for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases as well as operating loss, capital loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those differences or carryforwards are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in our Income tax provision in the period that includes the enactment date. Additionally, in determining the need for recording a valuation allowance against the carrying amount of deferred tax assets, we consider the amount of taxable income and periods over which it must be earned, actual levels of past taxable income and known trends and events or transactions that are expected to affect future levels of taxable income. Where we determine that it is more likely than not that all or a portion of an asset will not be realized, we record a valuation allowance. We recognize the benefit of positions taken or expected to be taken in our tax returns in our Income tax provision when it is more likely than not (i.e., a likelihood of more than fifty percent) that the position would be sustained upon examination by tax authorities. A recognized tax position is then measured at the largest amount of benefit that is greater than fifty percent likely of being realized upon settlement with the taxing authorities. We evaluate these amounts on a quarterly basis to ensure that they have been appropriately adjusted for audit settlements and other events we believe may impact the outcome. Changes in judgment that result in subsequent recognition, derecognition or a change in measurement of a tax position taken in a prior annual period (including any related interest and penalties) are recognized as a discrete item in the interim period in which the change occurs. We recognize accrued interest and penalties related to unrecognized tax benefits as components of our Income tax provision. We do not record a deferred tax liability for unremitted earnings of our foreign subsidiaries to the extent that the earnings meet the indefinite reversal criteria. This criteria is met if the foreign subsidiary has invested, or will invest, the earnings indefinitely. The decision as to the amount of unremitted earnings that we intend to maintain in non-U.S. subsidiaries considers items including, but not limited to, forecasts and budgets of financial needs of cash for working capital, liquidity plans and expected cash requirements in the U.S. See Note 17 for a further discussion of our income taxes. Fair Value Measurements. Fair value is the price we would receive to sell an asset or pay to transfer a liability (exit price) in an orderly transaction between market participants. For those assets and liabilities we record or disclose at fair value, we determine fair value based upon the quoted market price, if available. If a quoted market price is not available for identical assets, we determine fair value based upon the quoted market price of similar assets or the present value of expected future cash flows considering the risks involved, including counterparty performance risk if appropriate, and using discount rates appropriate for the duration. The fair values are assigned a level within the fair value hierarchy, depending on the source of the inputs into the calculation. Level 1 Inputs based upon quoted prices in active markets for identical assets. Level 2 Inputs other than quoted prices included within Level 1 that are observable for the asset, either directly or indirectly. Level 3 Inputs that are unobservable for the asset. Cash and Cash Equivalents. Cash equivalents represent funds we have temporarily invested (with original maturities not exceeding three months), including short-term, highly liquid debt securities. Cash and overdraft balances that meet the criteria for right of setoff are presented net on our Consolidated Balance Sheet. Receivables. The Company’s receivables are primarily generated from ongoing business relationships with our franchisees as a result of franchise agreements, as well as contributions due to consolidated advertising cooperatives. These receivabl |
Earnings Per Common Share ("EPS
Earnings Per Common Share ("EPS") | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Common Share (EPS) | Earnings Per Common Share (“EPS”) 2019 2018 2017 Net Income $ 1,294 $ 1,542 $ 1,340 Weighted-average common shares outstanding (for basic calculation) 306 322 347 Effect of dilutive share-based employee compensation 7 7 8 Weighted-average common and dilutive potential common shares outstanding (for diluted calculation) 313 329 355 Basic EPS $ 4.23 $ 4.80 $ 3.86 Diluted EPS $ 4.14 $ 4.69 $ 3.77 Unexercised employee stock options and stock appreciation rights (in millions) excluded from the diluted EPS computation (a) 2.0 2.0 2.3 (a) These unexercised employee stock options and stock appreciation rights were not included in the computation of diluted EPS because to do so would have been antidilutive for the periods presented. |
Items Affecting Comparability o
Items Affecting Comparability of Net Income and Cash Flows | 12 Months Ended |
Dec. 31, 2019 | |
Items Affecting Comparability Of Net Income And Cash Flows Disclosure [Abstract] | |
Items Affecting Comparability of Net Income and Cash Flows | Items Affecting Comparability of Net Income and Cash Flows Refranchising (Gain) Loss The Refranchising (gain) loss by our Divisional reportable segments is presented below. Given the size and volatility of refranchising initiatives, our chief operating decision maker ("CODM") does not consider the impact of Refranchising (gain) loss when assessing Divisional segment performance. As such, we do not allocate such gains and losses to our Divisional segments for performance reporting purposes. During the years ended December 31, 2019, 2018 and 2017, we refranchised 25 , 660 and 1,470 restaurants, respectively. Additionally, during the year ended December 31, 2019, we sold certain restaurant assets associated with existing franchise restaurants to the franchisee. We received $110 million , $825 million and $1,773 million in pre-tax refranchising proceeds in 2019, 2018 and 2017, respectively. A summary of Refranchising (gain) loss is as follows: Refranchising (gain) loss 2019 2018 2017 KFC Division $ (6 ) $ (240 ) $ (581 ) Pizza Hut Division — 13 (16 ) Taco Bell Division (31 ) (313 ) (486 ) Worldwide $ (37 ) $ (540 ) $ (1,083 ) As a result of classifying restaurant and related assets as held for sale and ceasing depreciation expense, depreciation expense was reduced versus what would have otherwise been recorded by less than $1 million , $3 million and $10 million during the years ended December 31, 2019, 2018 and 2017, respectively. Our CODM does not consider the impact of these depreciation reductions, which were recorded within Company restaurant expenses, when assessing Divisional segment performance. These depreciation reductions were recorded as an unallocated benefit and were not allocated to the Division segments resulting in depreciation expense continuing to be recorded within our Divisional results at the rate at which it was prior to the held for sale classification. Pizza Hut U.S. Transformation Agreement In May 2017, we reached an agreement with Pizza Hut U.S. franchisees that will improve brand marketing alignment, accelerate enhancements in operations and technology and that included a permanent commitment to incremental advertising as well as digital and technology contributions by franchisees (the “Transformation Agreement”). In connection with the Transformation Agreement we anticipate investing approximately $90 million from 2017 to 2020 to upgrade restaurant equipment to improve operations, fund improvements in restaurant technology and enhance digital and e-commerce capabilities. As of December 31, 2019, we have invested $89 million since the inception of the agreement. We have invested $25 million , $25 million and $39 million for the years ended December 31, 2019, 2018 and 2017, respectively, related to the Transformation Agreement. These amounts consisted of capital investments and franchisee incentive payments that were capitalized. Also included are operating investments of $13 million , $6 million and $31 million in the years ended December 31, 2019, 2018 and 2017, respectively. Due to their unique and long-term brand-building nature as well as their non-recurring impact on Pizza Hut’s Division results, the financial impact of operating investments that are part of the Transformation Agreement are not being considered by our CODM when assessing segment performance. As such, these operating investments are not being allocated to the Pizza Hut Division operating segment results for performance reporting purposes. Depreciation on capital investments made as part of the Transformation Agreement is being allocated to Pizza Hut segment results as the expense is recurring and is not expected to significantly impact the comparability of results in any given period. For the same reasons, the amortization related to capitalized franchisee incentive payments is being allocated to Pizza Hut Division operating segment results. In addition to the investments above, we funded $37.5 million of incremental system advertising from the second half of 2017 through 2018, including $12.5 million and $25 million we incurred during the years ended December 31, 2018 and 2017, respectively. These advertising amounts were recorded primarily in Franchise and property expenses and were included in the Pizza Hut Division segment operating results. KFC U.S. Acceleration Agreement During 2015, we reached an agreement with our KFC U.S. franchisees that gave us control of brand marketing execution as well as an accelerated path to expanded menu offerings, improved assets and enhanced customer experience. In connection with this agreement we invested approximately $130 million from 2015 through 2019. These investments, which primarily related to new back-of-house equipment for franchisees and incentives to accelerate franchisee store remodels, totaled $6 million , $6 million and $17 million in the years ended December 31, 2019, 2018 and 2017, respectively. To the extent these investments were not capitalized ( $2 million in 2018 and $17 million in 2017) the financial impacts of the investments were not considered by our CODM when assessing segment performance. As such, these investments are not being allocated to the KFC Division operating segment results for performance reporting purposes. As of December 31, 2019 the initiatives related to this program are substantially complete. In addition to the investments above, we funded $60 million of incremental system advertising from 2015 through 2018, including $10 million and $20 million incurred during the years ended December 31, 2018 and 2017, respectively. These advertising amounts were recorded primarily in Franchise and property expenses and were included in the KFC Division segment operating results. Turkey Acquisition Contingent Consideration During the second quarter of 2019 we recorded charges of $8 million and $2 million to Other (income) expense and Interest expense, net, respectively, related to cash payments in excess of our recorded liability to settle contingent consideration associated with our 2013 acquisition of the KFC Turkey and Pizza Hut Turkey businesses. Consistent with prior adjustments to the recorded contingent consideration, our CODM does not consider this charge when assessing segment performance due to the nature of these costs. As such, these costs were not allocated to any of our segment operating results for performance reporting purposes. Investment in Grubhub, Inc. ("Grubhub") On February 7, 2018, certain of our subsidiaries entered into a master services agreement with a subsidiary of Grubhub, an online and mobile takeout food-ordering company in the U.S., which is intended to provide dedicated support for the KFC and Taco Bell branded online delivery channels in the U.S. through Grubhub’s online ordering platform, logistics and last-mile support for delivery orders, as well as point-of-sale integration to streamline operations. Concurrently with the master services agreement, one of our subsidiaries entered into an investment agreement with Grubhub to invest $200 million in exchange for approximately 2.8 million shares of Grubhub common stock, subject to customary closing conditions. In April 2018, all necessary regulatory approvals were obtained and the purchase of Grubhub shares was consummated. Shares acquired as part of this purchase are restricted from being transferred until the earlier of the two-year anniversary of closing the investment agreement or 30 days following the termination of our master services agreement with Grubhub. In the years ended December 31, 2019 and 2018 we recognized pre-tax expense of $77 million and pre-tax income of $14 million , respectively, related to the mark-to-market of these shares, which includes the respective depreciation and appreciation in the market price of Grubhub common stock. Changes in the fair value of our investment in Grubhub common stock are presented as Investment (income) expense, net within our Consolidated Statements of Income. Income Tax Matters During the year ended December 31, 2019 we completed intercompany transfers of certain intellectual property rights. As a result of the transfer of certain of these rights, largely to subsidiaries in the United Kingdom, we received a step-up in tax basis to current fair value under applicable tax law. To the extent this step-up in basis will be amortizable against future taxable income, we recognized a one-time deferred tax benefit of $226 million in the year ended December 31, 2019. We recognized $434 million in our Income tax provision for the year ended December 31, 2017 as a result of the December 22, 2017 enactment of the Tax Cuts and Jobs Act of 2017 ("Tax Act"). During the year ended December 31, 2018, we recorded a $35 million decrease related to our provisional tax expense recorded in the fourth quarter of 2017 associated with the Tax Act. See Note 17. YUM's Strategic Transformation Initiatives In October 2016, we announced our strategic transformation plans to drive global expansion of the KFC, Pizza Hut and Taco Bell brands ("YUM's Strategic Transformation Initiatives") following the then anticipated spin-off of our China business (the "Separation") on October 31, 2016 into an independent, publicly-traded company under the name of Yum China Holdings, Inc. ("Yum China"). Major features of the Company’s strategic transformation plans involved being more focused on the development of our three brands, increasing our franchise ownership and creating a leaner, more efficient cost structure. We incurred pre-tax costs of $8 million and $23 million related to our Strategic Transformation Initiatives in 2018 and 2017, respectively, primarily recorded in G&A. In 2018 and 2017, these costs included contract termination costs and relocation and severance costs for restaurant-support center employees. Due to the scope of the initiatives as well as their significance, our CODM did not consider the associated cost when assessing segment performance. As such, these costs were not allocated to any of our segment operating results for performance reporting purposes. Modifications of Share-based Compensation Awards In connection with the Separation, we modified certain share-based compensation awards held as part of our Executive Income Deferral ("EID") Plan in phantom shares of YUM Common Stock to provide one phantom Yum China share-based award for each outstanding phantom YUM share-based award. Through October 31, 2018, these Yum China awards could be settled in cash, as opposed to stock, which required recognition of the fair value of these awards within G&A in our Consolidated Income Statement. During 2018 and 2017, we recorded pre-tax credits of $3 million and charges of $18 million , respectively, related to these awards due to changes in the market price of Yum China's common stock. Given these adjustments were a direct result of the separation of our China business, our CODM did not consider their impact when assessing segment performance. As such, these amounts were not allocated to any of our segment operating results. Beginning October 31, 2018, deferrals in phantom shares of Yum China common stock were no longer an investment option within our EID Plan and any balances relating to these phantom shares were moved to another available EID Plan investment option as selected by the participants. Amounts directed into cash or phantom shares of a Stock Index Fund or a Bond Index Fund remained classified as a liability and any appreciation or depreciation in these investments from the transfer date forward is being recognized as compensation expense and included in our segment operating results consistent with existing investments in these funds. Any balances directed into phantom shares of YUM Common Stock were reclassified to Common Stock on our Consolidated Balance Sheet. We do not recognize compensation expense for the appreciation or depreciation, if any, of investments in phantom shares of our Common Stock. See Note 15 for further description of our EID Plan. Impact of Adopting New Lease Standards As discussed in Note 2, we adopted Topic 842 at the beginning of the year ended December 31, 2019, using a modified retrospective method. Topic 842 was applied to all leases existing at, or entered into after, the beginning of 2019. As a result of adopting Topic 842, the following adjustments were made to the Consolidated Balance Sheet as of the beginning of the year ended December 31, 2019: CONSOLIDATED BALANCE SHEET As Reported 12/31/2018 Adjustments Balances with Adoption of Topic 842 1/1/2019 ASSETS Current Assets Cash and cash equivalents $ 292 $ — $ 292 Accounts and notes receivable, net 561 — 561 Prepaid expenses and other current assets 354 (10 ) 344 Total Current Assets 1,207 (10 ) 1,197 Property, plant and equipment, net 1,237 — 1,237 Goodwill 525 — 525 Intangible assets, net 242 — 242 Other assets 724 689 1,413 Deferred income taxes 195 — 195 Total Assets $ 4,130 $ 679 $ 4,809 LIABILITIES AND SHAREHOLDERS’ DEFICIT Current Liabilities Accounts payable and other current liabilities $ 911 $ 76 $ 987 Income taxes payable 69 — 69 Short-term borrowings 321 — 321 Total Current Liabilities 1,301 76 1,377 Long-term debt 9,751 — 9,751 Other liabilities and deferred credits 1,004 605 1,609 Total Liabilities 12,056 681 12,737 Shareholders’ Deficit Accumulated deficit (7,592 ) (2 ) (7,594 ) Accumulated other comprehensive loss (334 ) — (334 ) Total Shareholders’ Deficit (7,926 ) (2 ) (7,928 ) Total Liabilities and Shareholders’ Deficit $ 4,130 $ 679 $ 4,809 We recorded lease liabilities within Accounts payable and other current liabilities and Other liabilities and deferred credits of $83 million and $661 million , respectively, related to the present value of the remaining operating lease payments. These adjustments were partially offset by reductions to Accounts payable and other current liabilities and Other liabilities and deferred credits of $7 million and $56 million , respectively, primarily related to the write offs of liabilities previously recorded to reflect the impact of recognizing rent expense on a straight-line basis when lease payments were escalating under Legacy Lease GAAP. Additionally, lease liabilities recognized upon adoption were offset by the write-off of prepaid rent of $11 million that was recorded under Legacy Lease GAAP resulting in a decrease within Prepaid expenses and other current assets and Other assets of $10 million and $1 million , respectively. We recorded a corresponding right-of-use asset within Other Assets of $690 million . This right-of-use asset reflected a $2 million impairment charge that would have been recorded before adoption of Topic 842 had the right-of-use asset been recognized under Legacy Lease GAAP. A related increase was recorded in Accumulated deficit. Impact of Adopting New Revenue Recognition Standards As discussed in Note 2, we adopted Topic 606 at the beginning of the year ended December 31, 2018, using the modified retrospective method. Topic 606 was applied to all contracts with customers as of January 1, 2018 and the cumulative effective of this transition was recorded as an adjustment to Accumulated deficit as of this date. As a result, the following adjustments were made to the Consolidated Balance Sheet as of January 1, 2018: CONSOLIDATED BALANCE SHEET As Reported 12/31/2017 Adjustments Balances with Adoption of Topic 606 1/1/2018 ASSETS Current Assets Cash and cash equivalents $ 1,522 $ 11 $ 1,533 Accounts and notes receivable, net 400 112 512 Prepaid expenses and other current assets 384 76 (a) 460 Advertising cooperative assets, restricted 201 (201 ) — Total Current Assets 2,507 (2 ) 2,505 Property, plant and equipment, net 1,594 2 1,596 Goodwill 512 — 512 Intangible assets, net 214 9 223 Other assets 345 118 463 Deferred income taxes 139 26 165 Total Assets $ 5,311 $ 153 $ 5,464 LIABILITIES AND SHAREHOLDERS’ DEFICIT Current Liabilities Accounts payable and other current liabilities $ 813 $ 220 $ 1,033 Income taxes payable 123 — 123 Short-term borrowings 375 — 375 Advertising cooperative liabilities 201 (201 ) — Total Current Liabilities 1,512 19 1,531 Long-term debt 9,429 — 9,429 Other liabilities and deferred credits 704 353 1,057 Total Liabilities 11,645 372 12,017 Shareholders’ Deficit Accumulated deficit (6,063 ) (240 ) (6,303 ) Accumulated other comprehensive loss (271 ) 21 (250 ) Total Shareholders’ Deficit (6,334 ) (219 ) (6,553 ) Total Liabilities and Shareholders’ Deficit $ 5,311 $ 153 $ 5,464 (a) Includes $58 million of restricted cash related to advertising cooperatives. These balances can only be used to settle obligations of the respective cooperatives. We recorded an increase in Accounts payable and other current liabilities and Other liabilities and deferred credits of $57 million and $335 million , respectively, as part of our cumulative adjustment related to unamortized upfront franchise fees, with a corresponding $392 million increase in Accumulated deficit. We recorded increases in Prepaid expenses and other current assets and Other assets of $18 million and $118 million , respectively, as part of our cumulative adjustment related to unamortized franchise incentives, with a corresponding $136 million decrease in Accumulated deficit. Deferred income taxes increased $26 million as a result of recording the tax effects of the two adjustments noted above, with a corresponding decrease to Accumulated deficit. Accumulated other comprehensive loss decreased $21 million as a result of recognizing the impact of foreign currency translation related to the three adjustments noted above, with a corresponding increase in Accumulated deficit. The remaining adjustments to our December 31, 2017 Consolidated Balance Sheet are primarily a result of reclassifying the assets and liabilities of our consolidated advertising cooperative from Advertising cooperative assets, restricted and Advertising cooperative liabilities to the respective balance sheet caption to which the assets and liabilities relate. The following tables reflect the impact of the adoption of Topic 606 on our Consolidated Statement of Income for the year ended December 31, 2018 and our Consolidated Balance Sheet as of December 31, 2018. CONSOLIDATED STATEMENT OF INCOME Year ended 12/31/2018 Revenues As Reported Impact Balances under Legacy Revenue GAAP Company sales $ 2,000 $ — $ 2,000 Franchise and property revenues 2,482 43 2,525 Franchise contributions for advertising and other services 1,206 (1,206 ) — Total revenues 5,688 (1,163 ) 4,525 Costs and Expenses, Net Company restaurant expenses 1,634 — 1,634 General and administrative expenses 895 — 895 Franchise and property expenses 188 27 215 Franchise advertising and other services expense 1,208 (1,208 ) — Refranchising (gain) loss (540 ) 4 (536 ) Other (income) expense 7 — 7 Total costs and expenses, net 3,392 (1,177 ) 2,215 Operating Profit 2,296 14 (a) 2,310 Investment (income) expense, net (9 ) — (9 ) Other pension (income) expense 14 — 14 Interest expense, net 452 — 452 Income before income taxes 1,839 14 1,853 Income tax provision (benefit) 297 3 300 Net Income $ 1,542 $ 11 $ 1,553 Basic Earnings Per Common Share $ 4.80 $ 0.03 $ 4.83 Diluted Earnings Per Common Share $ 4.69 $ 0.03 $ 4.72 (a) Includes $23 million of franchise incentive payments made to or on behalf of franchisees during 2018 that under Legacy Revenue GAAP would have been recognized as expense in full in 2018. Due to the size and nature of such payments, we historically would not have allocated their impact to our Divisional results. Upon the adoption of Topic 606, these payments have been capitalized as assets. Upon the adoption of Topic 606, the timing and amount of revenue recognized for upfront franchise fees and franchise incentives changed from upfront recognition under Legacy Revenue GAAP to recognition over the term of the franchise agreement to which the fees and incentives relate. Also, under Legacy Revenue GAAP, amounts reported as Franchise contributions for advertising and other services and Franchise advertising and other services expense were presented on a net basis. Upon the adoption of Topic 606, these amounts require gross presentation in our Consolidated Statements of Income. Lastly, Legacy Revenue GAAP required that certain value-added taxes withheld and remitted on our behalf by our franchisees be reported as revenue and corresponding expense in our Consolidated Statements of Income. Upon adoption of Topic 606, these taxes are reported on a net basis as a reduction in Franchise and property revenues. CONSOLIDATED BALANCE SHEET As Reported 12/31/2018 Impact Balances under Legacy Revenue GAAP 12/31/2018 ASSETS Current Assets Cash and cash equivalents $ 292 $ (13 ) $ 279 Accounts and notes receivable, net 561 (120 ) 441 Prepaid expenses and other current assets 354 (107 ) 247 Advertising cooperative assets, restricted — 241 241 Total Current Assets 1,207 1 1,208 Property, plant and equipment, net 1,237 (2 ) 1,235 Goodwill 525 — 525 Intangible assets, net 242 (16 ) 226 Other assets 724 (127 ) 597 Deferred income taxes 195 (25 ) 170 Total Assets $ 4,130 $ (169 ) $ 3,961 LIABILITIES AND SHAREHOLDERS’ DEFICIT Current Liabilities Accounts payable and other current liabilities $ 911 $ (287 ) $ 624 Income taxes payable 69 — 69 Short-term borrowings 321 — 321 Advertising cooperative liabilities — 241 241 Total Current Liabilities 1,301 (46 ) 1,255 Long-term debt 9,751 — 9,751 Other liabilities and deferred credits 1,004 (354 ) 650 Total Liabilities 12,056 (400 ) 11,656 Shareholders’ Deficit Accumulated deficit (7,592 ) 251 (7,341 ) Accumulated other comprehensive loss (334 ) (20 ) (354 ) Total Shareholders’ Deficit (7,926 ) 231 (7,695 ) Total Liabilities and Shareholders’ Deficit $ 4,130 $ (169 ) $ 3,961 The significant impacts resulting from the adoption of Topic 606 on our Consolidated Balance Sheet as of December 31, 2018, are consistent with those recorded as of January 1, 2018 as described previously. Under Legacy Revenue GAAP, Cash, Cash Equivalents, Restricted Cash, and Restricted Cash Equivalents pertaining to advertising cooperatives that we were required to consolidate were classified within Advertising cooperative assets, restricted. Upon adoption of Topic 606, these amounts are reflected on our Consolidated Balance Sheet and changes in these balances are reported within our Consolidated Statement of Cash Flows. Items Impacting Other Pension (Income) Expense During the first quarter of 2017, as a result of the completion of a pension data review and reconciliation, we recorded a non-cash, out-of-year charge of $22 million to Other pension (income) expense to adjust our historical U.S. pension liability related to our deferred vested participants. Our CODM did not consider the impact of this charge when assessing segment performance given the number of years over which it accumulated. As such, this cost was not allocated to any of our segment operating results for performance reporting purposes. See Note 14 for further discussion of our pension plans. |
Note 5. Revenue Recognition (No
Note 5. Revenue Recognition (Notes) | 12 Months Ended |
Dec. 31, 2019 | |
Deferred Revenue Disclosure [Text Block] | Revenue Recognition Disaggregation of Total Revenues The following table disaggregates revenue by Concept, for our two most significant markets based on Operating Profit and for all other markets. We believe this disaggregation best reflects the extent to which the nature, amount, timing and uncertainty of our revenues and cash flows are impacted by economic factors. 2019 KFC Division Pizza Hut Division Taco Bell Division Total U.S. Company sales $ 74 $ 21 $ 919 $ 1,014 Franchise revenues 175 282 602 1,059 Property revenues 20 6 44 70 Franchise contributions for advertising and other services 10 318 483 811 China Franchise revenues 214 60 — 274 Other Company sales 497 33 2 532 Franchise revenues 912 246 27 1,185 Property revenues 69 3 — 72 Franchise contributions for advertising and other services 520 58 2 580 $ 2,491 $ 1,027 $ 2,079 $ 5,597 2018 KFC Division Pizza Hut Division Taco Bell Division Total U.S. Company sales $ 72 $ 37 $ 1,034 $ 1,143 Franchise revenues 171 284 539 994 Property revenues 23 4 27 54 Franchise contributions for advertising and other services 9 269 428 706 China Franchise revenues 201 59 — 260 Other Company sales 822 32 3 857 Franchise revenues 825 248 24 1,097 Property revenues 74 3 — 77 Franchise contributions for advertising and other services 447 52 1 500 $ 2,644 $ 988 $ 2,056 $ 5,688 Property revenues for the year ended December 31, 2017 were $86 million . Contract Liabilities Our contract liabilities are comprised of unamortized upfront fees received from franchisees. A summary of significant changes to the contract liability balance during 2019 and 2018 is presented below. Deferred Franchise Fees Balance at January 1, 2018 $ 392 Revenue recognized that was included in unamortized upfront fees received from franchisees at the beginning of the period (66 ) Increase for upfront fees associated with contracts that became effective during the period, net of amounts recognized as revenue during the period 102 Other (a) (14 ) Balance at December 31, 2018 $ 414 Revenue recognized that was included in unamortized upfront fees received from franchisees at the beginning of the period (70 ) Increase for upfront fees associated with contracts that became effective during the period, net of amounts recognized as revenue during the period 93 Other (a) 4 Balance at December 31, 2019 $ 441 (a) Includes impact of foreign currency translation as well as, in 2018, the recognition of deferred franchise fees into Refranchising (gain) loss upon the modification of existing franchise agreements when entering into master franchise agreements. We expect to recognize contract liabilities as revenue over the remaining term of the associated franchise agreement as follows: Less than 1 year $ 65 1 - 2 years 60 2 - 3 years 56 3 - 4 years 51 4 - 5 years 46 Thereafter 163 Total $ 441 We have applied the optional exemption, as provided for under Topic 606, which allows us to not disclose the transaction price allocated to unsatisfied performance obligations when the transaction price is a sales-based royalty. |
Supplemental Cash Flow Data
Supplemental Cash Flow Data | 12 Months Ended |
Dec. 31, 2019 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Data | Supplemental Cash Flow Data 2019 2018 2017 Cash Paid For: Interest $ 497 $ 455 $ 442 Income taxes 283 279 346 Significant Non-Cash Investing and Financing Activities: Finance lease obligations incurred $ 14 $ 4 $ 8 Finance lease and other debt obligations transferred through refranchising (1 ) (24 ) (35 ) Reconciliation of Cash and cash equivalents to Consolidated Statements of Cash Flows: Cash and cash equivalents as presented in Consolidated Balance Sheets $ 605 $ 292 $ 1,522 Restricted cash included in Prepaid expenses and other current assets (a) 138 151 60 Restricted cash and restricted cash equivalents included in Other assets (b) 25 31 17 Cash, Cash Equivalents and Restricted Cash as presented in Consolidated Statements of Cash Flows (c) $ 768 $ 474 $ 1,599 (a) Restricted cash within Prepaid expenses and other current assets reflects Taco Bell Securitization interest reserves (See Note 10) and the cash related to advertising cooperatives that we consolidate that can only be used to settle obligations of the respective cooperatives. (b) Primarily trust accounts related to our self-insurance program. (c) Upon adoption of Topic 606 we reclassified cash of $11 million and restricted cash of $58 million , respectively, from Advertising cooperative assets, restricted to Cash and cash equivalents and Prepaid expenses and other current assets. These amounts are included in the Beginning of Year balance of Cash, Cash Equivalents, Restricted Cash and Restricted Cash equivalents in our Consolidated Statement of Cash Flows for the year ended December 31, 2018. |
Other (Income) Expense
Other (Income) Expense | 12 Months Ended |
Dec. 31, 2019 | |
Other Income and Expenses [Abstract] | |
Other (Income) Expense | Other (Income) Expense 2019 2018 2017 Foreign exchange net (gain) loss and other (a) $ (1 ) $ 1 $ 7 Closure and impairment expense 5 6 3 Other (income) expense $ 4 $ 7 $ 10 (a) 2019 includes settlement of contingent consideration associated with our 2013 acquisition of the KFC Turkey and Pizza Hut Turkey businesses (See Note 4). |
Supplemental Balance Sheet Info
Supplemental Balance Sheet Information | 12 Months Ended |
Dec. 31, 2019 | |
Supplemental Balance Sheet Information Disclosure [Abstract] | |
Supplemental Balance Sheet Information | Supplemental Balance Sheet Information Prepaid Expenses and Other Current Assets 2019 2018 Income tax receivable $ 39 $ 36 Restricted cash 138 151 Assets held for sale (a) 25 24 Other prepaid expenses and current assets 136 143 Prepaid expenses and other current assets $ 338 $ 354 Property, Plant and Equipment 2019 2018 Land $ 408 $ 422 Buildings and improvements 1,325 1,349 Finance leases, primarily buildings 68 59 Machinery, equipment and other 505 523 Property, plant and equipment, gross 2,306 2,353 Accumulated depreciation and amortization (1,136 ) (1,116 ) Property, plant and equipment, net $ 1,170 $ 1,237 Depreciation and amortization expense related to PP&E was $114 million , $146 million and $215 million in 2019 , 2018 and 2017 , respectively. Other Assets 2019 2018 Operating lease right-of-use assets (b) $ 642 $ — Investment in Grubhub common stock (c) 137 214 Franchise incentives 174 141 Other 360 369 Other assets $ 1,313 $ 724 Accounts Payable and Other Current Liabilities 2019 2018 Accounts payable $ 173 $ 202 Accrued compensation and benefits 223 206 Accrued advertising 96 108 Operating lease liabilities (b) 67 — Accrued taxes, other than income taxes 52 48 Other current liabilities 349 347 Accounts payable and other current liabilities $ 960 $ 911 (a) Reflects the carrying value of restaurants we have offered for sale to franchisees and excess properties that we do not intend to use for restaurant operations in the future. (b) Increase from 2018 primarily due to the adoption of Topic 842 beginning with the year ended December 31, 2019. See Notes 2 and 4 for further discussion. (c) Refer to Note 4 for additional discussion regarding our investment in Grubhub. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The changes in the carrying amount of goodwill are as follows: KFC Pizza Hut Taco Bell Worldwide Goodwill, net as of December 31, 2017 (a) $ 247 $ 162 $ 103 $ 512 Disposal and other, net (b) (17 ) (5 ) (4 ) (26 ) QuikOrder acquisition (c) — 39 — 39 Goodwill, net as of December 31, 2018 (a) $ 230 $ 196 $ 99 $ 525 Disposal and other, net (b) 3 3 (1 ) 5 Goodwill, net as of December 31, 2019 (a) $ 233 $ 199 $ 98 $ 530 (a) Goodwill, net includes $17 million of accumulated impairment losses for each year presented related to our Pizza Hut segment. (b) Disposals and other, net includes the impact of foreign currency translation on existing balances and goodwill write-offs associated with refranchising. (c) In December 2018, we completed the acquisition of QuikOrder, LLC, an online ordering software and service provider for the restaurant industry (“QuikOrder”), who was a provider of services to Company and franchise restaurants of our Pizza Hut U.S. business for nearly two decades. The purchase price allocated for accounting purposes of $77 million consisted of cash, net of cash acquired, in the amount of $66 million , settlement of a prepaid asset of $6 million related to our preexisting contractual relationship with QuikOrder and contingent consideration of $5 million . The contingent consideration was paid in the year ended December 31, 2019. The acquisition was part of our strategy to deliver an easy and personalized online ordering experience and accelerate digital innovation. Subsequent to the acquisition, fees paid by franchisees for use of the QuikOrder software are being presented within Franchise contributions for advertising and other services. Associated costs we incur are being presented within Franchise advertising and other services expense and G&A. The primary assets recorded as a result of the purchase price allocation were goodwill of $39 million and amortizable intangible assets (primarily software) of $33 million . The goodwill recorded resulted from increased synergies expected to be achieved through leveraging our scale and resources to enhance the services previously offered by QuikOrder. The goodwill amortization is deductible for tax purposes and has been allocated to the Pizza Hut U.S. reporting unit. The pro forma impact on our results of operations if the acquisition had been completed as of the beginning of 2017 would not have been significant. The direct transaction costs associated with the acquisition were also not material and were expensed as incurred. Intangible assets, net for the years ended 2019 and 2018 are as follows: 2019 2018 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Definite-lived intangible assets Capitalized software costs $ 306 $ (130 ) $ 319 $ (156 ) Reacquired franchise rights 38 (32 ) 37 (30 ) Franchise contract rights 100 (83 ) 99 (79 ) Lease tenancy rights 5 (1 ) 11 (1 ) Other 38 (28 ) 38 (27 ) $ 487 $ (274 ) $ 504 $ (293 ) Indefinite-lived intangible assets KFC trademark $ 31 $ 31 Amortization expense for all definite-lived intangible assets was $52 million in 2019 , $37 million in 2018 and $33 million in 2017 . Amortization expense for definite-lived intangible assets is expected to approximate $53 million in 2020, $42 million in 2021, $25 million in 2022, $19 million in 2023 and $14 million in 2024. |
Short-term Borrowings and Long-
Short-term Borrowings and Long-term Debt | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Short-term Borrowings and Long-term Debt | Short-term Borrowings and Long-term Debt 2019 2018 Short-term Borrowings Current maturities of long-term debt $ 437 $ 331 Other 4 — 441 331 Less current portion of debt issuance costs and discounts (10 ) (10 ) Short-term borrowings $ 431 $ 321 Long-term Debt Securitization Notes $ 2,898 $ 2,928 Subsidiary Senior Unsecured Notes 2,850 2,850 Term Loan A Facility 463 488 Term Loan B Facility 1,935 1,955 YUM Senior Unsecured Notes 2,425 1,875 Finance lease obligations (See Note 11) 77 71 $ 10,648 $ 10,167 Less debt issuance costs and discounts (80 ) (85 ) Less current maturities of long-term debt (437 ) (331 ) Long-term debt $ 10,131 $ 9,751 Securitization Notes T aco Bell Funding, LLC (the “Issuer”), a special purpose limited liability company and a direct, wholly-owned subsidiary of Taco Bell Corp. (“TBC”) through a series of securitization transactions has issued fixed rate senior secured notes collectively referred to as the “Securitization Notes”. The following table summarizes Securitization Notes outstanding at December 31, 2019: Interest Rate Issuance Date Anticipated Repayment Date (a) Outstanding Principal (in millions) Stated Effective (b) May 2016 May 2023 $ 488 4.377 % 4.59 % May 2016 May 2026 $ 975 4.970 % 5.14 % November 2018 November 2023 $ 816 4.318 % 4.53 % November 2018 November 2028 $ 619 4.940 % 5.06 % (a) The legal final maturity dates of the Securitization Notes issued in 2016 and 2018 are May 2046 and November 2048, respectively. If the Issuer has not repaid or refinanced a series of Securitization Notes prior to its respective Anticipated Repayment Dates, rapid amortization of principal on all Securitization Notes will occur and additional interest will accrue on the Securitization Notes. (b) Includes the effects of the amortization of any discount and debt issuance costs. The Securitization Notes were issued in transactions pursuant to which certain of TBC’s domestic assets, consisting principally of franchise-related agreements and domestic intellectual property, were contributed to the Issuer and the Issuer’s special purpose, wholly-owned subsidiaries (the “Guarantors”, and collectively with the Issuer, the "Securitization Entities") to secure the Securitization Notes. The Securitization Notes are secured by substantially all of the assets of the Securitization Entities, and include a lien on all existing and future U.S. Taco Bell franchise and license agreements and the royalties payable thereunder, existing and future U.S. Taco Bell intellectual property, certain transaction accounts and a pledge of the equity interests in asset owning Securitization Entities. The remaining U.S. Taco Bell assets that were excluded from the transfers to the Securitization Entities continue to be held by Taco Bell of America, LLC ("TBA") and TBC. The Securitization Notes are not guaranteed by the remaining U.S. Taco Bell assets, the Company, or any other subsidiary of the Company. Payments of interest and principal on the Securitization Notes are made from the continuing fees paid pursuant to the franchise and license agreements with all U.S. Taco Bell restaurants, including both company and franchise operated restaurants. Interest on and principal payments of the Securitization Notes are due on a quarterly basis. In general, no amortization of principal of the Securitization Notes is required prior to their anticipated repayment dates unless as of any quarterly measurement date the consolidated leverage ratio (the ratio of total debt to Net Cash Flow (as defined in the related indenture)) for the preceding four fiscal quarters of either the Company and its subsidiaries or the Issuer and its subsidiaries exceeds 5.0:1, in which case amortization payments of 1% per year of the outstanding principal as of the closing of the Securitization Notes are required. As of the most recent quarterly measurement date the consolidated leverage ratio exceeded 5.0:1 and, as a result, amortization payments are required. The Securitization Notes are subject to a series of covenants and restrictions customary for transactions of this type, including (i) that the Issuer maintains specified reserve accounts to be available to make required interest payments in respect of the Securitization Notes, (ii) provisions relating to optional and mandatory prepayments and the related payment of specified amounts, including specified make-whole payments in the case of the Securitization Notes under certain circumstances, (iii) certain indemnification payments relating to taxes, enforcement costs and other customary items and (iv) covenants relating to recordkeeping, access to information and similar matters. The Securitization Notes are also subject to rapid amortization events provided for in the indenture, including events tied to failure to maintain a stated debt service coverage ratio (as defined in the related indenture) of at least 1.1:1 , gross domestic sales for branded restaurants being below certain levels on certain measurement dates, a manager termination event, an event of default and the failure to repay or refinance the Securitization Notes on the Anticipated Repayment Date (subject to limited cure rights). The Securitization Notes are also subject to certain customary events of default, including events relating to non-payment of required interest or principal due on the Securitization Notes, failure to comply with covenants within certain time frames, certain bankruptcy events, breaches of specified representations and warranties, failure of security interests to be effective, certain judgments and failure of the Securitization Entities to maintain a stated debt service coverage ratio . As of December 31, 2019, we were in compliance with all of our debt covenant requirements and were not subject to any rapid amortization events . In accordance with the indenture, certain cash accounts have been established with the indenture trustee for the benefit of the note holders, and are restricted in their use. The indenture requires a certain amount of securitization cash flow collections to be allocated on a weekly basis and maintained in a cash reserve account. As of December 31, 2019, the Company had restricted cash of $81 million primarily related to required interest reserves included in Prepaid expenses and other current assets on the Consolidated Balance Sheets. Once the required obligations are satisfied, there are no further restrictions, including payment of dividends, on the cash flows of the Securitization Entities. Additional cash reserves are required if any of the rapid amortization events occur, as noted above, or in the event that as of any quarterly measurement date the Securitization Entities fail to maintain a debt service coverage ratio (or the ratio of Net Cash Flow to all debt service payments for the preceding four fiscal quarters) of at least 1.75:1 . The amount of weekly securitization cash flow collections that exceed the required weekly allocations is generally remitted to the Company. During the most recent quarter ended December 31, 2019, the Securitization Entities maintained a debt service coverage ratio significantly in excess of the 1.75:1 requirement . Term Loan Facilities, Revolving Facility and Subsidiary Senior Unsecured Notes KFC Holding Co., Pizza Hut Holdings, LLC, and TBA, each of which is a wholly-owned subsidiary of the Company, as co-borrowers (the "Borrowers") have entered into a credit agreement providing for senior secured credit facilities and a $1.0 billion revolving facility (the Revolving Facility"). The senior secured credit facilities, which include a Term Loan A Facility and a Term Loan B Facility, and the Revolving Facility are collectively referred to as the "Credit Agreement". Additionally, the Borrowers through a series of transactions have issued the Subsidiary Senior Unsecured Notes due 2024, 2026 and 2027 (collectively referred to as the “Subsidiary Senior Unsecured Notes”). The following table summarizes borrowings outstanding under the Credit Agreement as well as our Subsidiary Senior Unsecured Notes as of December 31, 2019. There are no outstanding borrowings under the Revolving Facility and $1.3 million of letters of credit outstanding as of December 31, 2019. Interest Rate Issuance Date Maturity Date Outstanding Principal (in millions) Stated Effective (b) Term Loan A Facility June 2016 June 2022 $ 463 (a) 3.46 % Term Loan B Facility June 2016 April 2025 $ 1,935 (a) 3.65 % Senior Note Due 2024 June 2016 June 2024 $ 1,050 5.00 % 5.16 % Senior Note Due 2026 June 2016 June 2026 $ 1,050 5.25 % 5.39 % Senior Note Due 2027 June 2017 June 2027 $ 750 4.75 % 4.90 % (a) The interest rates applicable to the Term Loan A Facility as well as the Revolving Facility range from 1.25% to 1.75% plus LIBOR or from 0.25% to 0.75% plus the Base Rate (as defined in the Credit Agreement), at the Borrowers’ election, based upon the total leverage ratio of the Borrowers and the Specified Guarantors (as defined in the Credit Agreement). As of December 31, 2019 the interest rate spreads on the LIBOR and Base Rate applicable to our Term Loan A Facility were 1.50% and 0.50% , respectively. The interest rates applicable to the Term Loan B Facility are 1.75% plus LIBOR or 0.75% plus the Base Rate, at the Borrowers’ election. (b) Includes the effects of the amortization of any discount and debt issuance costs as well as the impact of the interest rate swaps on the Term Loan B Facility (See Note 12). The effective rates related to our Term Loan A and B Facilities are based on current LIBOR-based interest rates at December 31, 2019. The Term Loan A Facility is subject to quarterly amortization payments currently in an amount equal to 1.25% of the initial principal amount of the facility. These amortization payments will increase to an amount equal to 1.875% of the initial principal amount of the facility on the fourth anniversary of the closing date and to an amount equal to 3.75% of the initial principal amount of the facility on the fifth anniversary of the closing date, with the balance payable at maturity on June 7, 2022. The Term Loan B Facility is subject to quarterly amortization payments in an amount equal to 0.25% of the initial principal amount of the facility, with the balance payable at maturity on April 3, 2025. The Credit Agreement is unconditionally guaranteed by the Company and certain of the Borrowers’ principal domestic subsidiaries and excludes Taco Bell Funding LLC and its special purpose, wholly-owned subsidiaries (see above). The Credit Agreement is also secured by first priority liens on substantially all assets of the Borrowers and each subsidiary guarantor, excluding the stock of certain subsidiaries and certain real property, and subject to other customary exceptions. The Credit Agreement is subject to certain mandatory prepayments, including an amount equal to 50% of excess cash flow (as defined in the Credit Agreement) on an annual basis and the proceeds of certain asset sales, casualty events and issuances of indebtedness, subject to customary exceptions and reinvestment rights . The Credit Agreement includes two financial maintenance covenants which require the Borrowers to maintain a total leverage ratio (defined as the ratio of Consolidated Total Debt to Consolidated EBITDA (as these terms are defined in the Credit Agreement)) of 5.0:1 or less and a fixed charge coverage ratio (defined as the ratio of EBITDA minus capital expenditures to fixed charges (inclusive of rental expense and scheduled amortization)) of at least 1.5:1 , each as of the last day of each fiscal quarter. The Credit Agreement includes other affirmative and negative covenants and events of default that are customary for facilities of this type. The Credit Agreement contains, among other things, limitations on certain additional indebtedness and liens, and certain other transactions specified in the agreement. We were in compliance with all debt covenants as of December 31, 2019 . The Subsidiary Senior Unsecured Notes are guaranteed on a senior unsecured basis by (i) the Company, (ii) the Specified Guarantors and (iii) by each of the Borrower's and the Specified Guarantors’ domestic subsidiaries that guarantees the Borrower's obligations under the Credit Agreement, except for any of the Company’s foreign subsidiaries. The indenture governing the Subsidiary Senior Unsecured Notes contains covenants and events of default that are customary for debt securities of this type. We were in compliance with all debt covenants as of December 31, 2019 . YUM Senior Unsecured Notes The majority of our remaining long-term debt primarily comprises YUM Senior Unsecured Notes. The following table summarizes all YUM Senior Unsecured Notes issued that remain outstanding at December 31, 2019: Interest Rate Issuance Date Maturity Date Principal Amount (in millions) Stated Effective (a) October 2007 November 2037 $ 325 6.88 % 7.45 % August 2010 November 2020 $ 350 3.88 % 4.01 % August 2011 November 2021 $ 350 3.75 % 3.88 % October 2013 November 2023 $ 325 3.88 % 4.01 % October 2013 November 2043 $ 275 5.35 % 5.42 % September 2019 January 2030 $ 800 4.75 % 4.90 % (a) Includes the effects of the amortization of any (1) premium or discount; (2) debt issuance costs; and (3) gain or loss upon settlement of related treasury locks and forward starting interest rate swaps utilized to hedge the interest rate risk prior to debt issuance. As included in the table above, on September 11, 2019, Yum! Brands, Inc. issued $800 million aggregate principal amount of 4.75% YUM Senior Unsecured Notes due January 15, 2030 (the “2030 Notes”). The net proceeds from the issuance were used to repay in full $250 million aggregate principal amount of YUM Senior Unsecured Notes that matured in September 2019, to repay the then outstanding borrowings under our $1 billion revolving facility and for general corporate purposes. Interest on the 2030 Notes is payable semiannually in arrears on January 15 and July 15 of each year. The Company incurred debt issuance costs of $10 million in connection with the issuance of the 2030 Notes. These issuance costs are recorded as a reduction in Long-term debt on our Consolidated Balance Sheet. The YUM Senior Unsecured Notes represent senior, unsecured obligations and rank equally in right of payment with all of our existing and future unsecured unsubordinated indebtedness. Our YUM Senior Unsecured Notes contain cross-default provisions whereby the acceleration of the maturity of any of our indebtedness in a principal amount in excess of $50 million will constitute a default under the YUM Senior Unsecured Notes unless such indebtedness is discharged, or the acceleration of the maturity of that indebtedness is annulled, within 30 days after notice . The annual maturities of all Short-term borrowings and Long-term debt as of December 31, 2019 , excluding finance lease obligations of $77 million are as follows: Year ended: 2020 $ 434 2021 455 2022 424 2023 1,626 2024 1,086 Thereafter 6,550 Total $ 10,575 Interest expense on Short-term borrowings and Long-term debt was $519 million , $496 million and $473 million in 2019 , 2018 and 2017 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Leases | Lease Accounting Components of Lease Expense 2019 Operating lease cost $ 115 Finance lease cost Amortization of right-of-use assets 3 Interest on lease liabilities 3 Total finance lease cost 6 Sublease income (69 ) Rental expense related to operating leases was $151 million and $214 million for the years ended December 31, 2018 and 2017, respectively. Supplemental Cash Flow Information 2019 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 104 Operating cash flows from finance leases 3 Financing cash flows from finance leases 4 Right-of-use assets obtained in exchange for lease obligations Operating leases 79 Finance leases 14 Supplemental Balance Sheet Information 2019 Consolidated Balance Sheet Assets Operating lease right-of-use assets $ 642 Other assets Finance lease right-of-use assets 42 Property, plant and equipment, net Total right-of-use assets (a) $ 684 Liabilities Current Operating $ 67 Accounts payable and other current liabilities Finance 7 Short-term borrowings Non-current Operating 640 Other liabilities and deferred credits Finance 70 Long-term debt Total lease liabilities (a) $ 784 Weighted-average Remaining Lease Term (in years) Operating leases 12.3 Finance leases 12.7 Weighted-average Discount Rate Operating leases 5.6 % Finance leases 6.6 % (a) U.S. operating lease right-of-use assets and liabilities totaled $283 million and $337 million , respectively, as of December 31, 2019. These amounts primarily related to Taco Bell U.S. including leases related to Company-operated restaurants, leases related to franchise-operated restaurants we sublease and the Taco Bell restaurant support center. Maturity of Lease Payments and Receivables Future minimum lease payments, including rental payments for lease renewal options we are reasonably certain to exercise, and amounts to be received as lessor or sublessor as of December 31, 2019 were as follows: Commitments Lease Receivables Finance Operating Direct Financing Operating 2020 $ 11 $ 105 $ 5 $ 81 2021 11 100 4 76 2022 9 92 4 72 2023 9 83 4 69 2024 8 76 3 65 Thereafter 62 531 28 601 Total lease payments/receipts 110 987 48 $ 964 Less imputed interest/unearned income (33 ) (280 ) (18 ) Total lease liabilities/receivables $ 77 $ 707 $ 30 As of December 31, 2019, we have executed real estate leases that have not yet commenced with estimated future lease payments of approximately $46 million , which are not included in the tables above. These leases are expected to commence in 2020 with lease terms of up to 20 years. Future minimum lease payments and amounts to be received as lessor or sublessor under the non-cancellable term of leases as of December 31, 2018 as required to be disclosed under Legacy Lease GAAP were as follows: Commitments Lease Receivables Capital Operating Direct Financing Operating 2019 $ 10 $ 103 $ 6 $ 89 2020 10 89 5 79 2021 9 78 4 74 2022 8 71 4 69 2023 8 61 3 67 Thereafter 58 384 30 638 $ 103 $ 786 $ 52 $ 1,016 |
Derivative Instruments (Notes)
Derivative Instruments (Notes) | 12 Months Ended |
Dec. 31, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities Disclosure [Text Block] | Derivative Instruments We use derivative instruments to manage certain of our market risks related to fluctuations in interest rates and foreign currency exchange rates. Interest Rate Swaps We have entered into interest rate swaps with the objective of reducing our exposure to interest rate risk for a portion of our variable-rate debt interest payments. On July 25, 2016, we agreed with multiple counterparties to swap the variable LIBOR-based component of the interest payments related to $1.55 billion of borrowings under our Term Loan B Facility. These interest rate swaps will expire in July 2021. Further, on May 14, 2018 we entered into forward-starting interest rate swaps to fix the interest rate on $1.5 billion of borrowings under our Term Loan B Facility from the date the July 2016 swaps expire through March 2025. The interest rate swaps executed in May 2018 will result in a fixed rate of 4.81% on the swapped portion of the Term Loan B Facility from July 2021 through March 2025. These interest rate swaps are designated cash flow hedges as the changes in the future cash flows of the swaps are expected to offset changes in expected future interest payments on the related variable-rate debt. There were no other interest rate swaps outstanding as of December 31, 2019. Gains or losses on the interest rate swaps are reported as a component of AOCI and reclassified into Interest expense, net in our Consolidated Statements of Income in the same period or periods during which the related hedged interest payments affect earnings. Through December 31, 2019, the swaps were highly effective cash flow hedges. Foreign Currency Contracts We have entered into foreign currency forward and swap contracts with the objective of reducing our exposure to earnings volatility arising from foreign currency fluctuations associated with certain foreign currency denominated intercompany receivables and payables. The notional amount, maturity date, and currency of these contracts match those of the underlying intercompany receivables or payables. Our foreign currency contracts are designated cash flow hedges as the future cash flows of the contracts are expected to offset changes in intercompany receivables and payables due to foreign currency exchange rate fluctuations. Gains or losses on the foreign currency contracts are reported as a component of AOCI. Amounts are reclassified from AOCI each quarter to offset foreign currency transaction gains or losses recorded within Other (income) expense when the related intercompany receivables and payables affect earnings due to their functional currency remeasurements. Through December 31, 2019, all foreign currency contracts related to intercompany receivables and payables were highly effective cash flow hedges. As of December 31, 2019 and December 31, 2018, foreign currency contracts outstanding related to intercompany receivables and payables had total notional amounts of $20 million and $459 million , respectively. During the third quarter of 2019 we terminated foreign currency contracts with notional amounts of $430 million and settled the related intercompany receivable and payable. As a result of this termination and settlement, we reclassified $4 million of unrealized loss from AOCI to Interest expense, net in our Consolidated Statements of Income. We received $3 million in cash from the counterparty upon termination, which represented the fair value of the contracts at the time of termination. Our remaining foreign currency forward contracts all have durations that expire in 2020. As a result of the use of interest rate swaps and foreign currency contracts, the Company is exposed to risk that the counterparties will fail to meet their contractual obligations. To mitigate the counterparty credit risk, we only enter into contracts with major financial institutions carefully selected based upon their credit ratings and other factors, and continually assess the creditworthiness of counterparties. At December 31, 2019, all of the counterparties to our interest rate swaps and foreign currency contracts had investment grade ratings according to the three major ratings agencies. To date, all counterparties have performed in accordance with their contractual obligations. Gains and losses on derivative instruments designated as cash flow hedges recognized in OCI and reclassifications from AOCI into Net Income: Gains/(Losses) Recognized in OCI (Gains)/Losses Reclassified from AOCI into Net Income 2019 2018 2017 2019 2018 2017 Interest rate swaps $ (71 ) $ (3 ) $ 4 $ (17 ) $ (19 ) $ 2 Foreign currency contracts 20 22 (56 ) (8 ) (20 ) 56 Income tax benefit/(expense) 16 1 1 4 5 (3 ) As of December 31, 2019, the estimated net gain included in AOCI related to our cash flow hedges that will be reclassified into earnings in the next 12 months is $6 million , based on current LIBOR interest rates. See Note 13 for the fair value of our derivative assets and liabilities. |
Fair Value Disclosures
Fair Value Disclosures | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures | Fair Value Disclosures As of December 31, 2019 the carrying values of cash and cash equivalents, restricted cash, short-term investments, accounts receivable, short-term borrowings and accounts payable approximated their fair values because of the short-term nature of these instruments. The fair value of notes receivable net of allowances and lease guarantees less subsequent amortization approximates their carrying value. The following table presents the carrying value and estimated fair value of the Company’s debt obligations: 2019 2018 Carrying Value Fair Value (Level 2) Carrying Value Fair Value (Level 2) Securitization Notes (a) $ 2,898 $ 3,040 $ 2,928 $ 2,967 Subsidiary Senior Unsecured Notes (b) 2,850 3,004 2,850 2,733 Term Loan A Facility (b) 463 464 488 479 Term Loan B Facility (b) 1,935 1,949 1,955 1,915 YUM Senior Unsecured Notes (b) 2,425 2,572 1,875 1,798 (a) We estimated the fair value of the Securitization Notes by obtaining broker quotes from two separate brokerage firms that are knowledgeable about the Company’s Securitization Notes and, at times, trade these notes. The markets in which the Securitization Notes trade are not considered active markets. (b) We estimated the fair value of the YUM and Subsidiary Senior Unsecured Notes, Term Loan A Facility, and Term Loan B Facility using market quotes and calculations based on market rates. Recurring Fair Value Measurements The Company has interest rate swaps, foreign currency contracts, an investment in Grubhub common stock and other investments, all of which are required to be measured at fair value on a recurring basis (See Note 12 for discussion regarding derivative instruments and Note 4 for discussion regarding our investment in Grubhub common stock). The following table presents fair values for those assets and liabilities measured at fair value on a recurring basis and the level within the fair value hierarchy in which the measurements fall. Fair Value Consolidated Balance Sheet Level 2019 2018 Assets Interest Rate Swaps Prepaid expenses and other current assets 2 $ 6 $ 21 Foreign Currency Contracts Prepaid expenses and other current assets 2 — 5 Interest Rate Swaps Other assets 2 3 29 Investment in Grubhub Common Stock Other assets 1 137 214 Other Investments Other assets 1 43 27 Liabilities Interest Rate Swaps Other liabilities and deferred credits 2 71 23 Foreign Currency Contracts Other liabilities and deferred credits 2 — 24 The fair value of the Company’s foreign currency contracts and interest rate swaps were determined based on the present value of expected future cash flows considering the risks involved, including nonperformance risk, and using discount rates appropriate for the duration based on observable inputs. The fair value of the investment in Grubhub common stock was determined primarily based on closing market prices for the shares. The other investments primarily include investments in mutual funds, which are used to offset fluctuations for a portion of our deferred compensation liabilities and whose fair values were determined based on the closing market prices of the respective mutual funds as of December 31, 2019 and December 31, 2018. Non-Recurring Fair Value Measurements During the year ended December 31, 2019, we recognized non-recurring fair value measurements of $7 million related to refranchising related impairment. Refranchising related impairment results from writing down the assets of restaurants or restaurant groups offered for refranchising, including certain instances where a decision has been made to refranchise restaurants that are deemed to be impaired. The fair value measurements used in our impairment evaluation were based on actual bids received from potential buyers (Level 2). The remaining net book value of these restaurants at December 31, 2019 is insignificant. During the years ended December 31, 2019 and December 31, 2018, we recognized non-recurring fair value measurements of $4 million and $1 million , respectively, related to restaurant-level impairment. Restaurant-level impairment charges are recorded in Other (income) expense and resulted primarily from our impairment evaluation of long-lived assets of individual restaurants that |
Pension, Retiree Medical and Re
Pension, Retiree Medical and Retiree Savings Plans | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |
Retiree Medical Benefits | Pension, Retiree Medical and Retiree Savings Plans U.S. Pension Plans We sponsor qualified and supplemental (non-qualified) noncontributory defined benefit plans covering certain full-time salaried and hourly U.S. employees. The qualified plan meets the requirements of certain sections of the Internal Revenue Code and provides benefits to a broad group of employees with restrictions on discriminating in favor of highly compensated employees with regard to coverage, benefits and contributions. The supplemental plans provide additional benefits to certain employees. We fund our supplemental plans as benefits are paid. The most significant of our U.S. plans is the YUM Retirement Plan (the “Plan”), which is a qualified plan. Our funding policy with respect to the Plan is to contribute amounts necessary to satisfy minimum pension funding requirements, including requirements of the Pension Protection Act of 2006, plus additional amounts from time-to-time as are determined to be necessary to improve the Plan’s funded status. We do not expect to make any significant contributions to the Plan in 2020. Our two significant U.S. plans were previously amended such that any salaried employee hired or rehired by YUM after September 30, 2001 is not eligible to participate in those plans. We do not anticipate any plan assets being returned to the Company during 2020 for any U.S. plans. Obligation and Funded Status at Measurement Date: The following chart summarizes the balance sheet impact, as well as benefit obligations, assets, and funded status associated with our two significant U.S. pension plans. The actuarial valuations for all plans reflect measurement dates coinciding with our fiscal year end. 2019 2018 Change in benefit obligation: Benefit obligation at beginning of year $ 873 $ 1,007 Service cost 6 8 Interest cost 39 38 Plan amendments 2 1 Special termination benefits — 1 Benefits paid (57 ) (73 ) Settlement payments (1 ) — Actuarial (gain) loss 153 (109 ) Benefit obligation at end of year $ 1,015 $ 873 A significant component of the overall increase in the Company's benefit obligation for the year ended December 31, 2019 was due to an actuarial loss, which was primarily due to a decrease in the discount rate used to measure our benefit obligation from 4.60% at December 31, 2018 to 3.50% at December 31, 2019 . A significant component of the overall decrease in the Company's benefit obligation for the year ended December 31, 2018 was due to an actuarial gain, which was primarily due to an increase in the discount rate used to measure our benefit obligation from 3.90% at December 31, 2017 to 4.60% at December 31, 2018 . Change in plan assets: Fair value of plan assets at beginning of year $ 755 $ 864 Actual return on plan assets 176 (49 ) Employer contributions 12 13 Benefits paid (57 ) (73 ) Fair value of plan assets at end of year $ 886 $ 755 Funded status at end of year $ (129 ) $ (118 ) Amounts recognized in the Consolidated Balance Sheet: 2019 2018 Accrued benefit liability - current $ (4 ) $ (5 ) Accrued benefit liability - non-current (125 ) (113 ) $ (129 ) $ (118 ) The accumulated benefit obligation was $984 million and $849 million at December 31, 2019 and December 31, 2018 , respectively. Information for pension plans with an accumulated benefit obligation in excess of plan assets: 2019 2018 Projected benefit obligation $ 1,015 $ 873 Accumulated benefit obligation 984 849 Fair value of plan assets 886 755 Information for pension plans with a projected benefit obligation in excess of plan assets: 2019 2018 Projected benefit obligation $ 1,015 $ 873 Accumulated benefit obligation 984 849 Fair value of plan assets 886 755 Components of net periodic benefit cost: 2019 2018 2017 Service cost $ 6 $ 8 $ 10 Interest cost 39 38 41 Amortization of prior service cost (a) 6 5 6 Expected return on plan assets (44 ) (44 ) (45 ) Amortization of net loss 1 16 5 Net periodic benefit cost $ 8 $ 23 $ 17 Additional (gain) loss recognized due to: Settlement charges (b) $ 3 $ — $ 19 Special termination benefits $ — $ 1 $ 2 Pension data adjustment (c) $ — $ — $ 22 (a) Prior service costs are amortized on a straight-line basis over the average remaining service period of employees expected to receive benefits. (b) Settlement losses result when benefit payments exceed the sum of the service cost and interest cost within a plan during the year. These losses were recorded in Other pension (income) expense. (c) Reflects a non-cash, out-of-year charge related to the adjustment of certain historical deferred vested liability balances in the Plan during the first quarter of 2017 recorded in Other pension (income) expense. See Note 4. Pension gains (losses) in AOCI: 2019 2018 Beginning of year $ (123 ) $ (160 ) Net actuarial gain (loss) (22 ) 17 Curtailments — — Amortization of net loss 1 16 Amortization of prior service cost 6 5 Prior service cost (2 ) (1 ) Settlement charges 4 — End of year $ (136 ) $ (123 ) Accumulated pre-tax losses recognized within AOCI: 2019 2018 Actuarial net loss $ (118 ) $ (101 ) Prior service cost (18 ) (22 ) $ (136 ) $ (123 ) Weighted-average assumptions used to determine benefit obligations at the measurement dates: 2019 2018 Discount rate 3.50 % 4.60 % Rate of compensation increase 3.00 % 3.00 % Weighted-average assumptions used to determine the net periodic benefit cost for fiscal years: 2019 2018 2017 (a) Discount rate 4.60 % 3.90 % 4.53 % Long-term rate of return on plan assets 5.75 % 5.65 % 6.06 % Rate of compensation increase 3.00 % 3.75 % 3.75 % (a) Reflects a weighted average due to interim re-measurements in 2017. Our estimated long-term rate of return on plan assets represents the weighted-average of expected future returns on the asset categories included in our target investment allocation based primarily on the historical returns for each asset category and future growth expectations. Plan Assets The fair values of our pension plan assets at December 31, 2019 and December 31, 2018 by asset category and level within the fair value hierarchy are as follows: 2019 2018 Level 1: Cash $ 5 $ 3 Cash Equivalents (a) 13 10 Fixed Income Securities - U.S. Corporate (b) 161 140 Equity Securities – U.S. Large cap (b) 268 215 Equity Securities – U.S. Mid cap (b) 44 35 Equity Securities – U.S. Small cap (b) 43 34 Equity Securities – Non-U.S. (b) 88 74 Level 2: Fixed Income Securities – U.S. Corporate (c) 120 106 Fixed Income Securities – U.S. Government and Government Agencies (d) 274 161 Fixed Income Securities – Other (d) 39 18 Total fair value of plan assets (e) $ 1,055 $ 796 (a) Short-term investments in money market funds. (b) Securities held in common trusts. (c) Investments held directly by the Plan. (d) Includes securities held in common trusts and investments held directly by the Plan. (e) 2019 and 2018 exclude net unsettled trade payables of $169 million and $41 million , respectively. Our primary objectives regarding the investment strategy for the Plan’s assets are to reduce interest rate and market risk and to provide adequate liquidity to meet immediate and future payment requirements. To achieve these objectives, we are using a combination of active and passive investment strategies. The Plan's equity securities, currently targeted to be 50% of our investment mix, consist primarily of low-cost index funds focused on achieving long-term capital appreciation. The Plan diversifies its equity risk by investing in several different U.S. and foreign market index funds. Investing in these index funds provides the Plan with the adequate liquidity required to fund benefit payments and plan expenses. The fixed income asset allocation, currently targeted to be 50% of our mix, is actively managed and consists of long-duration fixed income securities that help to reduce exposure to interest rate variation and to better correlate asset maturities with obligations. The fair values of all pension plan assets are determined based on closing market prices or net asset values. A mutual fund held as an investment by the Plan includes shares of Common Stock valued at $0.3 million at both December 31, 2019 and December 31, 2018 (less than 1% of total plan assets in each instance). Benefit Payments The benefits expected to be paid in each of the next five years and in the aggregate for the five years thereafter are set forth below: Year ended: 2020 $ 43 2021 47 2022 49 2023 52 2024 53 2025 - 2029 287 Expected benefit payments are estimated based on the same assumptions used to measure our benefit obligation on the measurement date and include benefits attributable to estimated future employee service. International Pension Plans We also sponsor various defined benefit plans covering certain of our non-U.S. employees, the most significant of which are in the UK. Both of our UK plans have previously been frozen such that they are closed to new participants and existing participants can no longer earn future service credits. At the end of 2019 and 2018 , the projected benefit obligations of these UK plans totaled $290 million and $233 million , respectively and plan assets totaled $372 million and $319 million , respectively. These plans were both in a net overfunded position at the end of 2019 and 2018 and related expense amounts recorded in each of 2019 , 2018 and 2017 were not significant. The funding rules for our pension plans outside of the U.S. vary from country to country and depend on many factors including discount rates, performance of plan assets, local laws and regulations. We do not plan to make significant contributions to either of our UK plans in 2020 . Retiree Medical Benefits Our post-retirement plan provides health care benefits, principally to U.S. salaried retirees and their dependents, and includes retiree cost-sharing provisions and a cap on our liability. This plan was previously amended such that any salaried employee hired or rehired by YUM after September 30, 2001 is not eligible to participate in this plan. Employees hired prior to September 30, 2001 are eligible for benefits if they meet age and service requirements and qualify for retirement benefits. We fund our post-retirement plan as benefits are paid. At the end of 2019 and 2018 , the accumulated post-retirement benefit obligation was $44 million and $45 million , respectively. Actuarial pre-tax gains of $9 million and $13 million were recognized in AOCI at the end of 2019 and 2018 , respectively. The net periodic benefit cost recorded was $1 million in 2019 , $2 million in 2018 and $2 million in 2017 , the majority of which is interest cost on the accumulated post-retirement benefit obligation. The weighted-average assumptions used to determine benefit obligations and net periodic benefit cost for the post-retirement medical plan are identical to those as shown for the U.S. pension plans. The benefits expected to be paid in each of the next five years are approximately $4 million and in aggregate for the five years thereafter are $14 million . U.S. Retiree Savings Plan We sponsor a contributory plan to provide retirement benefits under the provisions of Section 401(k) of the Internal Revenue Code (the “401(k) Plan”) for eligible U.S. salaried and hourly employees. Participants are able to elect to contribute up to 75% of eligible compensation on a pre-tax basis. Participants may allocate their contributions to one or any combination of multiple investment options or a self-managed account within the 401(k) Plan. We match 100% of the participant’s contribution to the 401(k) Plan up to 6% of eligible compensation. We recognized as compensation expense our total matching contribution of $11 million in 2019 , $12 million in 2018 and $13 million in 2017 . |
Share-based and Deferred Compen
Share-based and Deferred Compensation Plans | 12 Months Ended |
Dec. 31, 2019 | |
Compensation Related Costs [Abstract] | |
Share-based and Deferred Compensation Plans | Share-based and Deferred Compensation Plans Overview At year end 2019 , we had one stock award plan in effect: the Yum! Brands, Inc. Long-Term Incentive Plan (the “LTIP”). Under the LTIP, the exercise price of stock options and SARs granted must be equal to or greater than the average market price or the ending market price of the Company’s stock on the date of grant. Potential awards to employees and non-employee directors under the LTIP include stock options, incentive stock options, SARs, restricted stock, restricted stock units (“RSUs”), performance restricted stock units, performance share units (“PSUs”) and performance units. We have issued only stock options, SARs, RSUs and PSUs under the LTIP. While awards under the LTIP can have varying vesting provisions and exercise periods, outstanding awards under the LTIP vest in periods ranging from immediate to five years. Stock options and SARs generally expire ten years after grant. At year end 2019 , approximately 26 million shares were available for future share-based compensation grants under the LTIP. Our EID Plan allows participants to defer receipt of a portion of their annual salary and all or a portion of their incentive compensation. As defined by the EID Plan, we credit the amounts deferred with earnings based on the investment options selected by the participants. These investment options are limited to cash, phantom shares of our Common Stock, phantom shares of a Stock Index Fund and phantom shares of a Bond Index Fund. Investments in cash and phantom shares of both index funds will be distributed in cash at a date as elected by the employee and therefore are classified as a liability on our Consolidated Balance Sheets. We recognize compensation expense for the appreciation or the depreciation, if any, of investments in cash and both of the index funds. Deferrals into the phantom shares of our Common Stock will be distributed in shares of our Common Stock, under the LTIP, at a date as elected by the employee and therefore are classified in Common Stock on our Consolidated Balance Sheets. We do not recognize compensation expense for the appreciation or the depreciation, if any, of investments in phantom shares of our Common Stock. Our EID plan also allows certain participants to defer incentive compensation to purchase phantom shares of our Common Stock and receive a 33% Company match on the amount deferred. Deferrals receiving a match are similar to an RSU award in that participants will generally forfeit both the match and incentive compensation amounts deferred if they voluntarily separate from employment during a vesting period that is two years from the date of deferral. We expense the intrinsic value of the match and the incentive compensation amount over the requisite service period which includes the vesting period. Historically, the Company has repurchased shares on the open market in excess of the amount necessary to satisfy award exercises and expects to continue to do so in 2020. In connection with the Separation of our China business, under the provisions of our LTIP, employee stock options, SARs, RSUs and PSUs were adjusted to maintain the pre-spin intrinsic value of the awards. Depending on the tax laws of the country of employment, awards were modified using either the shareholder method or the employer method. Share-based compensation as recorded in Net Income is based on the amortization of the fair value for both YUM and Yum China awards held by YUM employees. Share issuances for Yum China awards held by YUM employees will be satisfied by Yum China. Share issuances for YUM awards held by Yum China employees are being satisfied by YUM. Under the shareholder method, investments in phantom shares of our Common Stock held within our EID Plan were partially converted into phantom investments in Yum China. Through October 31, 2018, distributions of investments in phantom shares of Yum China could be settled in cash, as opposed to stock, at a date as elected by the employee and, therefore, were classified as a liability and remeasured to fair value at each reporting period in our Consolidated Balance Sheet. During 2018 and 2017, we recorded a $3 million credit and a $18 million charge, respectively, within G&A related to these awards (See Note 4). As of October 31, 2018, deferrals in phantom shares of Yum China common stock were no longer an investment option within our EID Plan and any balances relating to these shares were moved to another available EID Plan investment option as selected by the participants. Amounts directed into cash or phantom shares of a Stock Index Fund or a Bond Index Fund remained classified as a liability and appreciation or depreciation in these investments from the transfer date forward are recognized as compensation expense. Any amounts directed into phantom shares of YUM Common Stock were reclassified to Common Stock on our Consolidated Balance Sheet. We do not recognize compensation expense for the appreciation or depreciation, if any, of investments in phantom shares of our Common Stock. Award Valuation We estimated the fair value of each stock option and SAR award as of the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions: 2019 2018 2017 Risk-free interest rate 2.5 % 2.5 % 1.9 % Expected term 6.5 years 6.5 years 6.4 years Expected volatility 22.0 % 22.0 % 22.9 % Expected dividend yield 1.8 % 1.8 % 1.8 % We believe it is appropriate to group our stock option and SAR awards into two homogeneous groups when estimating expected term. These groups consist of grants made primarily to restaurant-level employees, which cliff-vest after 4 years and expire 10 years after grant, and grants made to executives, which typically have a graded vesting schedule of 25% per year over 4 years and expire 10 years after grant. We use a single weighted-average term for our awards that have a graded vesting schedule. Based on analysis of our historical exercise and post-vesting termination behavior, we have determined that our restaurant-level employees and our executives exercised the awards on average after 5 years and 6.5 years, respectively. When determining expected volatility, we consider both historical volatility of our stock as well as implied volatility associated with our publicly-traded options. The expected dividend yield is based on the annual dividend yield at the time of grant. The fair values of PSU awards without market-based conditions and RSU awards are based on the closing price of our Common Stock on the date of grant. The fair values of PSU awards with market-based conditions have been valued based on the outcome of a Monte Carlo simulation. Award Activity Stock Options and SARs Shares (in thousands) Weighted-Average Exercise Price Weighted- Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in millions) Outstanding at the beginning of the year 16,191 $ 51.84 Granted 2,332 93.52 Exercised (3,210 ) 38.16 Forfeited or expired (449 ) 75.29 Outstanding at the end of the year 14,864 (a) 60.76 5.62 $ 594 Exercisable at the end of the year 9,283 $ 49.38 4.10 $ 477 (a) Outstanding awards include 782 options and 14,082 SARs with weighted average exercise prices of $45.03 and $61.64 , respectively. Outstanding awards represent YUM awards held by employees of both YUM and Yum China. The weighted-average grant-date fair value of stock options and SARs granted during 2019 , 2018 and 2017 was $19.82 , $16.45 and $14.08 , respectively. The total intrinsic value of stock options and SARs exercised during the years ended December 31, 2019 , December 31, 2018 and December 31, 2017 , was $204 million , $195 million and $154 million , respectively. As of December 31, 2019 , $49 million of unrecognized compensation cost related to unvested stock options and SARs, which will be reduced by any forfeitures that occur, is expected to be recognized over a remaining weighted-average period of approximately 1.7 years. This reflects unrecognized cost for both YUM and Yum China awards held by YUM employees. The total fair value at grant date of awards for both YUM and Yum China awards held by YUM employees that vested during 2019 , 2018 and 2017 was $31 million , $28 million and $33 million , respectively. RSUs and PSUs As of December 31, 2019 , there was $30 million of unrecognized compensation cost related to 1.1 million unvested RSUs and PSUs, none of which related to Yum China common stock. The total fair value at grant date of awards that vested during 2019, 2018 and 2017 was $14 million , $16 million and $10 million , respectively. Impact on Net Income The components of share-based compensation expense and the related income tax benefits are shown in the following table: 2019 2018 2017 Options and SARs $ 39 $ 37 $ 30 Restricted Stock Units 12 6 26 Performance Share Units 8 7 9 Total Share-based Compensation Expense $ 59 $ 50 (a) $ 65 (a) Deferred Tax Benefit recognized $ 9 $ 9 $ 22 (b) EID compensation expense not share-based $ 17 $ (2 ) $ 12 (a) Includes $3 million of appreciation and $18 million of depreciation in the market price of Yum China's stock in 2018 and 2017, respectively. See Note 4. (b) Deferred tax benefit recognized does not reflect the impact of the Tax Act. See Note 17. Cash received from stock option exercises for 2019 , 2018 and 2017 was $1 million , $5.5 million and $12 million , respectively. Tax benefits realized on our tax returns from tax deductions associated with share-based compensation for 2019 , 2018 and 2017 totaled $66 million , $60 million and $153 million , respectively. |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
Shareholders' Equity | Shareholders’ Deficit Under the authority of our Board of Directors, we repurchased shares of our Common Stock during 2019 , 2018 and 2017 . All amounts exclude applicable transaction fees. Shares Repurchased (thousands) Dollar Value of Shares Repurchased Authorization Date 2019 2018 2017 2019 2018 2017 August 2018 7,788 10,003 — 810 894 — November 2017 — 18,240 — — 1,500 — November 2016 — — 26,561 — — 1,915 Total 7,788 (a) 28,243 (a) 26,561 (b) $ 810 (a) $ 2,394 (a) $ 1,915 (b) (a) 2019 amount excludes and 2018 amount includes the effect of $5 million in share repurchases ( 0.1 million shares) with trade dates on, or prior to, December 31, 2018 but settlement dates subsequent to December 31, 2018. (b) 2017 amount excludes the effect of $45 million in share repurchases ( 0.7 million shares) with trade dates prior to December 31, 2016 but settlement dates subsequent to December 31, 2016. On November 21, 2019, our Board of Directors authorized share repurchases through June 2021 of up to $2 billion (excluding applicable transaction fees) of our outstanding Common Stock. As of December 31, 2019, we have remaining capacity to repurchase up to $2 billion of Common Stock under this authorization. Unutilized share repurchase capacity of $296 million under the August 2018 authorization expired on December 31, 2019. Changes in AOCI are presented below. Translation Adjustments and Gains (Losses) From Intra-Entity Transactions of a Long-Term Nature (a) Pension and Post-Retirement Benefits (b) Derivative Instruments (c) Total Balance at December 31, 2017, net of tax $ (174 ) $ (106 ) $ 9 $ (271 ) Adoption of accounting standards 21 (d) (17 ) (e) (2 ) (e) 2 OCI, net of tax Gains (losses) arising during the year classified into AOCI, net of tax (88 ) 24 20 (44 ) (Gains) losses reclassified from AOCI, net of tax (4 ) 17 (34 ) (21 ) (92 ) 41 (14 ) (65 ) Balance at December 31, 2018, net of tax $ (245 ) $ (82 ) $ (7 ) $ (334 ) OCI, net of tax Gains (losses) arising during the year classified into AOCI, net of tax 24 (30 ) (35 ) (41 ) (Gains) losses reclassified from AOCI, net of tax — 8 (21 ) (13 ) 24 (22 ) (56 ) (54 ) Balance at December 31, 2019, net of tax $ (221 ) $ (104 ) $ (63 ) $ (388 ) (a) Amounts reclassified from AOCI are due to substantially complete liquidations of foreign entities related to the KFC and Pizza Hut Brazil refranchising transactions during 2018. (b) Amounts reclassified from AOCI for pension and post-retirement benefit plans losses during 2019 include amortization of net losses of $2 million , amortization of prior service cost of $5 million , settlement charges of $3 million and related income tax benefit of $2 million . Amounts reclassified from AOCI for pension and post-retirement benefit plan losses during 2018 include amortization of net losses of $17 million , amortization of prior service cost of $5 million and related income tax benefit of $5 million . See Note 14. (c) See Note 12 for details on amounts reclassified from AOCI. (d) Represents the impact of foreign currency translation from the adoption of Topic 606. See Notes 2 and 4. (e) |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes U.S. and foreign income before taxes are set forth below: 2019 2018 2017 U.S. $ 466 $ 726 $ 662 Foreign 907 1,113 1,612 $ 1,373 $ 1,839 $ 2,274 The details of our income tax provision (benefit) are set forth below: 2019 2018 2017 Current: Federal $ 129 $ 102 $ (2 ) Foreign 166 181 290 State 16 25 12 $ 311 $ 308 $ 300 Deferred: Federal $ (16 ) $ (24 ) $ 603 Foreign (213 ) 5 19 State (3 ) 8 12 $ (232 ) $ (11 ) $ 634 $ 79 $ 297 $ 934 The reconciliation of income taxes calculated at the U.S. federal statutory rate to our effective tax rate is set forth below: 2019 2018 2017 U.S. federal statutory rate 21.0 % 21.0 % 35.0 % State income tax, net of federal tax 0.8 1.0 0.5 Statutory rate differential attributable to foreign operations 1.6 (12.3 ) (9.3 ) Adjustments to reserves and prior years 4.2 2.8 0.5 Share-based compensation (4.0 ) (2.5 ) (5.1 ) Change in valuation allowances (2.6 ) 8.5 1.5 Intercompany restructuring (16.1 ) — — Tax Act Enactment — (1.9 ) 19.1 Other, net 0.8 (0.4 ) (1.1 ) Effective income tax rate 5.7 % 16.2 % 41.1 % Statutory rate differential attributable to foreign operations. This item includes local country taxes, withholding taxes, and shareholder-level taxes, net of foreign tax credits. In 2019, this expense included the full year impact of the global intangible low-taxed income (GILTI) provisions of the Tax Cuts and Jobs Act of 2017. In 2018, this benefit was positively impacted by approximately 8 percentage points due to a transaction resulting in the recognition of excess foreign tax credits that were fully offset by expense included in 'Change in valuation allowances' . 2017 is favorably impacted by a majority of our income being earned outside of the U.S. where tax rates were generally lower than the U.S. rate. Adjustments to reserves and prior years. This item includes: (1) changes in tax reserves, including interest thereon, established for potential exposure we may incur if a taxing authority takes a position on a matter contrary to our position; and (2) the effects of reconciling income tax amounts recorded in our Consolidated Statements of Income to amounts reflected on our tax returns, including any adjustments to the Consolidated Balance Sheets. In 2019, this item was unfavorably impacted by $31 million in reserves related to the inclusion of stock based compensation in cost sharing arrangements that was largely offset by the benefit from the utilization of foreign tax credits included in 'Change in valuation allowances' as well as $34 million in reserves related to taxes recorded associated with a prior year divestiture. This unfavorable impact was partially offset by the reversal of a $20 million reserve established in 2018 due to the favorable resolution of an income tax rate dispute in a foreign market. In 2018, this item was unfavorably impacted by the aforementioned $20 million reserve and a $19 million charge for the correction of an error associated with the tax recorded on a prior year divestiture. Share-based compensation. 2019, 2018 and 2017 includes $55 million , $47 million and $117 million , respectively, of excess tax benefit related to share-based compensation. The 2017 excess tax benefits were largely associated with deferred compensation payouts to recently retired employees. Change in valuation allowances. This item relates to changes for deferred tax assets generated or utilized during the current year and changes in our judgment regarding the likelihood of using deferred tax assets that existed at the beginning of the year. The impact of certain changes may offset items reflected in the 'Statutory rate differential attributable to foreign operations' line and the ' Adjustments to reserves and prior years' line . In 2019, $35 million of net tax benefit was driven by a $45 million tax benefit attributable to changes in judgment regarding deferred tax assets that existed at the beginning of the year largely resulting from the utilization of foreign tax credits as discussed in ' Adjustments to reserves and prior years' sections above. This benefit was partially offset by $9 million of expense for valuation allowances recorded against deferred tax assets generated in the current year. This amount excludes a valuation allowance of $373 million which is included in the ' Intercompany Restructuring' line. In 2018, $156 million of net tax expense was driven by valuation allowances recorded against deferred tax assets generated in the current year. This expense was largely offset by a benefit related to a transaction resulting in the recognition of excess foreign tax credits in 'Statutory rate differential attributable to foreign operations' . This amount also excludes a valuation allowance release of $78 million , which is included in the ' Tax Act Enactment' line. In 2017, $34 million of net tax expense was driven by valuation allowances recorded against deferred tax assets generated in the current year. This amount excludes a valuation allowance of $189 million , which is included in the ' Tax Act Enactment' line. Intercompany Restructuring. In December 2019, we completed an intercompany restructuring that resulted in the transfer of certain intellectual property rights held by wholly owned foreign subsidiaries primarily to the U.S. and the United Kingdom (UK). The intellectual property rights transferred to the UK resulted in a step up in the tax basis for UK tax purposes resulting in a deferred tax asset of $586 million . The deferred tax asset was analyzed for realizability and a valuation allowance of $366 million was established representing the portion of the deferred tax asset not likely to be realized. The recognized tax benefit of $220 million is amortizable for UK tax purposes over a twenty year period. The transfer of certain intellectual property rights to other non-UK jurisdictions resulted in the recording of deferred tax assets of $13 million and related valuation allowances of $7 million for deferred tax assets that are not likely to be realized, for a net tax benefit of $6 million . Tax Act Enactment. On December 22, 2017, the U.S. government enacted comprehensive Federal tax legislation commonly referred to as the Tax Cuts and Jobs Act of 2017 (the "Tax Act"). The Tax Act significantly modifies the U.S. corporate income tax system by, among other things, reducing the federal income tax rate from 35% to 21% , limiting certain deductions, including limiting the deductibility of interest expense to 30% of U.S. Earnings Before Interest, Taxes, Depreciation and Amortization, imposing a mandatory one-time deemed repatriation tax on accumulated foreign earnings and creating a territorial tax system that changes the manner in which foreign earnings are subject to U.S. tax. On December 22, 2017, the SEC staff issued Staff Accounting Bulletin 118 which allowed us to record provisional amounts related to the impacts of the Tax Act during a measurement period not to extend beyond one year of the enactment date. As a result, we recorded a $434 million provisional estimate of the effect of the Tax Act in 2017. This expense was comprised of an estimate of our deemed repatriation tax, the remeasurement of net deferred tax assets resulting from the permanent reduction in the U.S. tax rate to 21% , and establishment of a valuation allowance on foreign tax credit carryforwards which are unlikely to be realized under the U.S. territorial tax system. In 2018, we completed the accounting for the tax effects of the enactment of the Tax Act. As a result of the Tax Act, we recorded cumulative net tax expense of $399 million ( $35 million benefit in 2018 and $434 million expense in 2017). This net expense was comprised of $241 million for our deemed repatriation tax liability, $47 million related to the remeasurement of our net deferred tax assets to the 21% U.S. tax rate and $111 million to establish a valuation allowance on foreign tax credits that are unlikely to be realized under the U.S. territorial tax system. Other. This item primarily includes the net impact of permanent differences related to current year earnings as well as U.S. tax credits. In 2018 and 2017, this item was primarily driven by the favorable impact of certain international refranchising gains. Companies subject to the Global Intangible Low-Taxed Income provision (GILTI) have the option to account for the GILTI tax as a period cost if and when incurred, or to recognize deferred taxes for outside basis temporary differences expected to reverse as GILTI. The Company has elected to account for GILTI as a period cost. The details of 2019 and 2018 deferred tax assets (liabilities) are set forth below: 2019 2018 Operating losses $ 176 $ 180 Capital losses 3 3 Tax credit carryforwards 230 266 Employee benefits 85 72 Share-based compensation 55 62 Self-insured casualty claims 6 7 Lease-related liabilities 199 43 Various liabilities 43 43 Intangible assets 602 8 Property, plant and equipment 21 19 Deferred income and other 85 45 Gross deferred tax assets 1,505 748 Deferred tax asset valuation allowances (787 ) (454 ) Net deferred tax assets $ 718 $ 294 Intangible assets, including goodwill $ (40 ) $ (42 ) Property, plant and equipment (44 ) (33 ) Operating lease right-of-use assets (156 ) — Other (31 ) (31 ) Gross deferred tax liabilities $ (271 ) $ (106 ) Net deferred tax assets (liabilities) $ 447 $ 188 Reported in Consolidated Balance Sheets as: Deferred income taxes $ 447 $ 195 Other liabilities and deferred credits — (7 ) $ 447 $ 188 As of December 31, 2019, we had approximately $2.9 billion of unremitted foreign retained earnings. The Tax Act imposed U.S. federal tax on all post-1986 foreign Earnings and Profits accumulated through December 31, 2017. Repatriation of earnings generated after December 31, 2017, will generally be eligible for the 100% dividends received deduction or considered a distribution of previously taxed income and, therefore, exempt from U.S. tax. Undistributed foreign earnings may still be subject to certain foreign income and withholding taxes upon repatriation. Subject to limited exceptions, our intent is to indefinitely reinvest our unremitted earnings outside the U.S., and our current plans do not demonstrate a need to repatriate these amounts to fund our U.S. operations. Thus, we have not provided taxes, including U.S. federal and state income, foreign income, or foreign withholding taxes, for the unremitted earnings that we believe are permanently invested. However, if these funds were repatriated in taxable transactions, we would be required to accrue and pay applicable income taxes (if any) and foreign withholding taxes. A determination of the deferred tax liability on this amount is not practicable due to the complexities, variables and assumptions inherent in the hypothetical calculations. At December 31, 2019, the Company has foreign operating and capital loss carryforwards of $0.4 billion , U.S. state operating loss and tax credit carryforwards of $1.1 billion , and U.S. federal tax credit carryforwards of $0.2 billion . The tax losses are being carried forward in jurisdictions where we are permitted to use losses from prior periods to reduce future taxable income. The losses and tax credits will expire as follows: Year of Expiration 2020 2021-2024 2025-2038 Indefinitely Total Foreign $ 10 $ 26 $ 36 $ 336 $ 408 U.S. state 2 111 1,021 — 1,134 U.S. federal — 36 178 — 214 $ 12 $ 173 $ 1,235 $ 336 $ 1,756 Valuation allowances of $0.1 billion , $0.1 billion and $0.2 billion have been recorded against the deferred tax assets established for foreign operating loss and capital loss carryforwards, the U.S. state operating loss and tax credit carryforwards, and the U.S. federal tax credit carryforwards, respectively, that are not likely to be realized. We recognize the benefit of positions taken or expected to be taken in tax returns in the Consolidated Financial Statements when it is more likely than not that the position would be sustained upon examination by tax authorities. A recognized tax position is measured at the largest amount of benefit that is greater than fifty percent likely of being realized upon settlement. The Company had $188 million and $113 million of unrecognized tax benefits at December 31, 2019 and December 31, 2018, respectively, $8 million and $10 million of which are temporary in nature and if recognized, would not impact the effective income tax rate. A reconciliation of the beginning and ending amount of unrecognized tax benefits follows: 2019 2018 Beginning of Year $ 113 $ 100 Additions on tax positions - current year 84 19 Additions for tax positions - prior years 54 — Reductions for tax positions - prior years (30 ) (5 ) Reductions for settlements (31 ) — Reductions due to statute expiration (2 ) (1 ) Foreign currency translation adjustment — — End of Year $ 188 $ 113 The Company believes it is reasonably possible that its unrecognized tax benefits as of December 31, 2019 may decrease by approximately $26 million in the next 12 months due to settlements or statute of limitations expirations. The Company’s income tax returns are subject to examination in the U.S. federal jurisdiction and numerous U.S. state and foreign jurisdictions. The Company has settled audits with the IRS through fiscal year 2010 and is currently under IRS examination for 2011-2015. Our operations in certain foreign jurisdictions remain subject to examination for tax years as far back as 2006, some of which years are currently under audit by local tax authorities. The accrued interest and penalties related to income taxes at December 31, 2019 and December 31, 2018 were $26 million and $12 million , respectively. During 2019, 2018 and 2017, the company recognized a net expense of $13 million , a net benefit of $2 million and a net expense of $5 million , respectively, for interest and penalties in our Consolidated Statements of Income as components of its Income tax provision. |
Reportable Operating Segments
Reportable Operating Segments | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Reportable Operating Segments | Reportable Operating Segments See Note 1 for a description of our operating segments. Revenues 2019 2018 2017 KFC Division (a) $ 2,491 $ 2,644 $ 3,110 Pizza Hut Division (a) 1,027 988 893 Taco Bell Division (a) 2,079 2,056 1,880 Unallocated (b)(f) — — (5 ) $ 5,597 $ 5,688 $ 5,878 Operating Profit 2019 2018 2017 KFC Division $ 1,052 $ 959 $ 981 Pizza Hut Division 369 348 341 Taco Bell Division 683 633 619 Corporate and unallocated G&A expenses (b)(g) (188 ) (171 ) (230 ) Unallocated Company restaurant expenses (b)(h) — 3 10 Unallocated Franchise and property revenues (b)(f) — — (5 ) Unallocated Franchise and property expenses (b)(f) (14 ) (8 ) (30 ) Unallocated Refranchising gain (loss) (b) 37 540 1,083 Unallocated Other income (expense) (b) (9 ) (8 ) (8 ) Operating Profit 1,930 2,296 2,761 Investment income (expense), net (b) (67 ) 9 5 Other pension income (expense) (b)(i) (4 ) (14 ) (47 ) Interest expense, net (b) (486 ) (452 ) (445 ) Income before income taxes $ 1,373 $ 1,839 $ 2,274 Depreciation and Amortization 2019 2018 2017 KFC Division $ 30 $ 58 $ 138 Pizza Hut Division 15 10 26 Taco Bell Division 59 61 82 Corporate 8 8 7 $ 112 $ 137 $ 253 Capital Spending 2019 2018 2017 KFC Division $ 81 $ 105 $ 176 Pizza Hut Division 33 38 42 Taco Bell Division 76 85 95 Corporate 6 6 5 $ 196 $ 234 $ 318 Identifiable Assets (d) 2019 2018 KFC Division $ 2,042 $ 1,481 Pizza Hut Division 801 701 Taco Bell Division 1,330 1,074 Corporate (c) 1,058 874 $ 5,231 $ 4,130 Long-Lived Assets (e) 2019 2018 KFC Division $ 1,179 $ 868 Pizza Hut Division 427 384 Taco Bell Division 938 720 Corporate 42 32 $ 2,586 $ 2,004 (a) U.S. revenues included in the combined KFC, Pizza Hut and Taco Bell Divisions totaled $3.0 billion in 2019, $2.9 billion in 2018 and $2.8 billion in 2017. (b) Amounts have not been allocated to any segment for performance reporting purposes. (c) Primarily includes cash, our Grubhub investment and deferred tax assets. (d) U.S. identifiable assets included in the combined Corporate and KFC, Pizza Hut and Taco Bell Divisions totaled $2.7 billion and $2.0 billion in 2019 and 2018, respectively. (e) Includes PP&E, goodwill, intangible assets, net and in 2019, Operating lease right-of-use assets. (f) Represents costs associated with the KFC U.S. Acceleration Agreement and Pizza Hut U.S. Transformation Agreement. See Note 4. (g) Amounts in 2018 include costs related to YUM's Strategic Transformation Initiatives of $8 million , partially offset by non-cash credits associated with modifications of share-based compensation awards of $3 million . Amounts in 2017 include costs related to YUM’s Strategic Transformation Initiatives of $21 million , non-cash charges associated with modifications of share-based compensation awards of $18 million and costs associated with the Pizza Hut U.S. Transformation Agreement of $13 million . See Note 4. (h) Represents depreciation reductions arising primarily from KFC restaurants that were held for sale. See Note 4. (i) Amounts in 2017 include a non-cash charge of $22 million related to the adjustment of certain historical deferred vested liability balances in our qualified U.S. plan. See Note 4. |
Contingencies
Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies Lease Guarantees As a result of having assigned our interest in obligations under real estate leases as a condition to the refranchising of certain Company-owned restaurants, and guaranteeing certain other leases, we are frequently secondarily liable on lease agreements. These leases have varying terms, the latest of which expires in 2065. As of December 31, 2019 , the potential amount of undiscounted payments we could be required to make in the event of non-payment by the primary lessee was approximately $475 million . The present value of these potential payments discounted at our pre-tax cost of debt at December 31, 2019 was approximately $400 million . Our franchisees are the primary lessees under the vast majority of these leases. We generally have cross-default provisions with these franchisees that would put them in default of their franchise agreement in the event of non-payment under the lease. We believe these cross-default provisions significantly reduce the risk that we will be required to make payments under these leases. Accordingly, the liability recorded for our probable exposure under such leases at December 31, 2019 and December 31, 2018 was not material. Insurance Programs We are self-insured for a substantial portion of our current and prior years’ coverage including property and casualty losses. To mitigate the cost of our exposures for certain property and casualty losses, we self-insure the risks of loss up to defined maximum per occurrence retentions on a line-by-line basis. The Company then purchases insurance coverage, up to a certain limit, for losses that exceed the self-insurance per occurrence retention. The insurers’ maximum aggregate loss limits are significantly above our actuarially determined probable losses; therefore, we believe the likelihood of losses exceeding the insurers’ maximum aggregate loss limits is remote. The following table summarizes the 2019 and 2018 activity related to our net self-insured property and casualty reserves as of December 31, 2019 . Beginning Balance Expense Payments Ending Balance 2019 Activity $ 66 9 (21 ) $ 54 2018 Activity $ 84 11 (29 ) $ 66 Due to the inherent volatility of actuarially determined property and casualty loss estimates, it is reasonably possible that we could experience changes in estimated losses which could be material to our growth in quarterly and annual Net Income. We believe that we have recorded reserves for property and casualty losses at a level which has substantially mitigated the potential negative impact of adverse developments and/or volatility. In the U.S. and in certain other countries, we are also self-insured for healthcare claims and long-term disability for eligible participating employees subject to certain deductibles and limitations. We have accounted for our retained liabilities for property and casualty losses, healthcare and long-term disability claims, including reported and incurred but not reported claims, based on information provided by independent actuaries. Legal Proceedings We are subject to various claims and contingencies related to lawsuits, real estate, environmental and other matters arising in the normal course of business. An accrual is recorded with respect to claims or contingencies for which a loss is determined to be probable and reasonably estimable. Yum! Restaurants India Private Limited (“YRIPL”), a Yum subsidiary in India, is the subject of a regulatory enforcement action in India (the “Action”). The Action alleges, among other things, that KFC International Holdings, Inc. and Pizza Hut International failed to satisfy certain conditions imposed by the Secretariat for Industrial Approval in 1993 and 1994 when those companies were granted permission for foreign investment and operation in India. The conditions at issue include an alleged minimum investment commitment and store build requirements as well as limitations on the remittance of fees outside of India. The Action originated with a complaint and show cause notice filed in 2009 against YRIPL by the Deputy Director of the Directorate of Enforcement (“DOE”) of the Indian Ministry of Finance following an income tax audit for the years 2002 and 2003. The matter was argued at hearing in 2015, but no order was issued. Following a change in the incumbent official holding the position of Special Director of DOE (the “Special Director”), the matter resumed in 2018 and several additional hearings were conducted. On January 29, 2020, the Special Director issued an order imposing a penalty on YRIPL and certain former directors of approximately Indian Rupee 11 billion , or approximately $156 million. Of this amount, approximately $150 million relates to the alleged failure to invest a total of $80 million in India within an initial seven year period. We have been advised by external counsel that the order is flawed and that several options for appeal exist. We deny liability and intend to continue vigorously defending this matter. We do not consider the risk of any significant loss arising from this order to be probable. We are currently engaged in various other legal proceedings and have certain unresolved claims pending, the ultimate liability for which, if any, cannot be determined at this time. However, based upon consultation with legal counsel, we are of the opinion that such proceedings and claims are not expected to have a material adverse effect, individually or in the aggregate, on our Consolidated Financial Statements. |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
Selected Quarterly Financial Information [Abstract] | |
Selected Quarterly Financial Data (Unaudited) | Selected Quarterly Financial Data (Unaudited ) 2019 First Quarter Second Quarter Third Quarter Fourth Quarter Total Revenues: Company sales $ 333 $ 359 $ 364 $ 490 $ 1,546 Franchise and property revenues 612 633 645 770 2,660 Franchise contributions for advertising and other services 309 318 330 434 1,391 Total revenues 1,254 1,310 1,339 1,694 5,597 Restaurant profit 61 73 72 105 311 Operating Profit (a) 433 471 480 546 1,930 Net Income 262 289 255 488 1,294 Basic earnings per common share 0.85 0.94 0.83 1.61 4.23 Diluted earnings per common share 0.83 0.92 0.81 1.58 4.14 Dividends declared per common share 0.42 0.42 0.42 0.42 1.68 2018 First Quarter Second Quarter Third Quarter Fourth Quarter Total Revenues: Company sales $ 512 $ 512 $ 499 $ 477 $ 2,000 Franchise and property revenues 584 584 605 709 2,482 Franchise contributions for advertising and other services 275 272 287 372 1,206 Total revenues 1,371 1,368 1,391 1,558 5,688 Restaurant profit 74 91 100 101 366 Operating Profit (b) 553 449 553 741 2,296 Net Income 433 321 454 334 1,542 Basic earnings per common share 1.30 0.99 1.43 1.07 4.80 Diluted earnings per common share 1.27 0.97 1.40 1.04 4.69 Dividends declared per common share 0.36 0.36 0.36 0.36 1.44 (a) Includes net gains from refranchising initiatives of $6 million , $4 million , $8 million and $19 million in the first, second, third and fourth quarters, respectively. (b) Includes net gains from refranchising initiatives of $156 million , $29 million , $100 million and $255 million in the first, second, third and fourth quarters, respectively. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Principles of Consolidation and Basis of Preparation | Principles of Consolidation and Basis of Preparation. Intercompany accounts and transactions have been eliminated in consolidation. We consolidate entities in which we have a controlling financial interest, the usual condition of which is ownership of a majority voting interest. We also consider for consolidation an entity, in which we have certain interests, where the controlling financial interest may be achieved through arrangements that do not involve voting interests. Such an entity, known as a variable interest entity (“VIE”), is required to be consolidated by its primary beneficiary. The primary beneficiary is the entity that possesses the power to direct the activities of the VIE that most significantly impact its economic performance and has the obligation to absorb losses or the right to receive benefits from the VIE that are significant to it. Our most significant variable interests are in entities that operate restaurants under our Concepts’ franchise and license arrangements. We do not have an equity interest in any of our franchisee businesses except for a minority interest in an entity that owns our KFC Brazil and Pizza Hut Brazil master franchisee rights. This minority interest does not give us the ability to significantly influence the franchisee. Additionally, we do not typically provide significant financial support such as loans or guarantees to our franchisees. However, we do have variable interests in certain franchisees through real estate lease arrangements to which we are a party. At the end of 2019 , YUM has future lease payments due from franchisees, on a nominal basis, of approximately $1 billion , and we are secondarily liable on certain other lease agreements that have been assigned to franchisees. See the Lease Guarantees section in Note 19. As our franchise arrangements provide our franchisee entities the power to direct the activities that most significantly impact their economic performance, we do not consider ourselves the primary beneficiary of any such entity that might otherwise be considered a VIE. We participate in various advertising cooperatives with our franchisees, typically within a country where we have both Company-owned restaurants and franchise restaurants, established to collect and administer funds contributed for use in advertising and promotional programs designed to increase sales and enhance the reputation of the Company and our Concepts. Contributions to the advertising cooperatives are required for both Company-owned and franchise restaurants and are generally based on a percentage of restaurant sales. We maintain certain variable interests in these cooperatives. As the cooperatives are required to spend all funds collected on advertising and promotional programs, total equity at risk is not sufficient to permit the cooperatives to finance their activities without additional subordinated financial support. Therefore, these cooperatives are VIEs. As a result of our voting rights, we consolidate certain of these cooperatives for which we are the primary beneficiary. |
Fiscal Year | Fiscal Year. YUM's fiscal year begins on January 1 and ends December 31 of each year, with each quarter comprised of three months. Our U.S. subsidiaries and certain international subsidiaries operate on a weekly periodic calendar where the first three quarters of each fiscal year consists of 12 weeks and the fourth quarter consists of 16 weeks in fiscal years with 52 weeks and 17 weeks in fiscal years with 53 weeks. Our remaining international subsidiaries operate on a monthly calendar similar to that on which YUM operates. Fiscal year 2019 included 53 weeks for our U.S. businesses and for our international subsidiaries that reported on a period calendar. The 53 rd week added $66 million to Total revenues, $24 million to Operating Profit and $17 million to Net Income in our 2019 Consolidated Statement of Income. On January 27, 2017, YUM’s Board of Directors approved a change in the Company's fiscal year from a year ending on the last Saturday of December to a year beginning on January 1 and ending December 31 of each year, commencing with the year ending December 31, 2017. In connection with this change, the Company moved from a 52-week periodic fiscal calendar with three 12 -week interim quarters and a 16 -week fourth quarter to a monthly reporting calendar with each quarter comprised of three months. Our U.S. subsidiaries continue to report on a period calendar as described above. Concurrent with the change in the Company's fiscal year, we also eliminated the one month or one period reporting lags of our international subsidiaries. As a result of removing these reporting lags, each international subsidiary operates either on a monthly calendar consistent with the Company’s new calendar or on a periodic calendar consistent with our U.S. subsidiaries. We believe this change in our international subsidiary reporting calendars and the resulting elimination of reporting lags is preferable because a more current reporting calendar allows the Consolidated Financial Statements to more consistently and more timely reflect the impact of current events, economic conditions and global trends. The change to the Company’s fiscal year and removal of the international reporting lags became effective beginning in 2017. We applied this change in accounting principle retrospectively to financial periods presented prior to 2017. Our next fiscal year scheduled to include a 53rd week is 2024. |
Foreign Currency | Foreign Currency. The functional currency of our foreign entities is the currency of the primary economic environment in which the entity operates. Functional currency determinations are made based upon a number of economic factors, including but not limited to cash flows and financing transactions. The operations, assets and liabilities of our entities outside the U.S. are initially measured using the functional currency of that entity. Income and expense accounts for our operations of these foreign entities are then translated into U.S. dollars at the average exchange rates prevailing during the period. Assets and liabilities of these foreign entities are then translated into U.S. dollars at exchange rates in effect at the balance sheet date. As of December 31, 2019 , net cumulative translation adjustment losses of $221 million are recorded in Accumulated other comprehensive loss ("AOCI") in the Consolidated Balance Sheet. The majority of our foreign currency net asset exposure is in countries where we have Company-owned restaurants. As we manage and share resources at the individual brand level within a country, cumulative translation adjustments are recorded and tracked at the foreign-entity level that represents the operations of our individual brands within that country. Translation adjustments recorded in AOCI are subsequently recognized as income or expense generally only upon sale of the related investment in a foreign entity, or upon a sale of assets and liabilities within a foreign entity that represents a complete or substantially complete liquidation of that foreign entity. For purposes of determining whether a sale or complete or substantially complete liquidation of an investment in a foreign entity has occurred, we consider those same foreign entities for which we record and track cumulative translation adjustments. Gains and losses arising from the impact of foreign currency exchange rate fluctuations on transactions in foreign currency are included in Other (income) expense in our Consolidated Statements of Income. |
Reclassifications | Reclassifications. We have reclassified certain items in the Consolidated Financial Statements for prior periods to be comparable with the classification for the fiscal year ended December 31, 2019 . These reclassifications had no effect on previously reported Net Income. |
Revenue Recognition | Revenue Recognition. From 2014 through 2017, the Financial Accounting Standards Board ("FASB") issued standards to provide principles within a single framework for revenue recognition of transactions involving contracts with customers across all industries ("Topic 606"). We adopted Topic 606 at the beginning of the year ended December 31, 2018. Below is a discussion of how our revenues are earned, our accounting policies pertaining to revenue recognition prior to the adoption of Topic 606 ("Legacy Revenue GAAP"), our accounting policies pertaining to revenue recognition subsequent to the adoption of Topic 606 and other required disclosures. Refer to Note 4 for information regarding the cumulative effect adjustment recorded to Accumulated deficit as of the beginning of the year ended December 31, 2018 to reflect the adoption of Topic 606. Also included in Note 4 is disclosure of the amount by which each balance sheet and income statement line item was impacted in 2018 as compared to Legacy Revenue GAAP. Company Sales Revenues from the sale of food items by Company-owned restaurants are recognized as Company sales when a customer purchases the food, which is when our obligation to perform is satisfied. The timing and amount of revenue recognized related to Company sales was not impacted by the adoption of Topic 606. Franchise and Property Revenues Franchise Revenues Our most significant source of revenues arises from the operation of our Concepts' stores by our franchisees. Franchise rights may be granted through a store-level franchise agreement or through a master franchise agreement that sets out the terms of our arrangement with the franchisee. Our franchise agreements require that the franchisee remit continuing fees to us as a percentage of the applicable restaurant’s sales in exchange for the license of the intellectual property associated with our Concepts' brands (the “franchise right”). Our franchise agreements also typically require certain, less significant, upfront franchise fees such as initial fees paid upon opening of a store, fees paid to renew the term of the franchise right and fees paid in the event the franchise agreement is transferred to another franchisee. Continuing fees represent the substantial majority of the consideration we receive under our franchise agreements. Continuing fees are typically billed and paid monthly and are usually 4% - 6% for store-level franchise agreements. Master franchise agreements allow master franchisees to operate restaurants as well as sub-franchise restaurants within certain geographic territories. The percentage of sales that we receive for restaurants owned or sub-franchised by our master franchisees as a continuing fee is typically less than the percentage we receive for restaurants operating under a store-level franchise agreement. Upfront franchise fees are typically billed and paid when a new franchise or sub-franchise agreement becomes effective or when an existing agreement is transferred to another franchisee or sub-franchisee. Under Legacy Revenue GAAP, continuing fees were recognized as the related restaurant sales occurred. The timing and amount of revenue recognized related to continuing fees was not impacted by the adoption of Topic 606 based on the application of the sales-based royalty exception within Topic 606. Under Legacy Revenue GAAP, revenue related to initial fees was recognized upon store opening and renewal and transfer fees were recognized when the related agreement became effective. Upon the adoption of Topic 606, we have determined that the services we provide in exchange for these upfront franchise fees, which primarily relate to pre-opening support, are highly interrelated with the franchise right and are not individually distinct from the ongoing services we provide to our franchisees. As a result, upon the adoption of Topic 606, upfront franchise fees are recognized as revenue over the term of each respective franchise or sub-franchise agreement. Revenues for these upfront franchise fees are recognized on a straight-line basis, which is consistent with the franchisee’s or sub-franchisee's right to use and benefit from the intellectual property. Revenues from continuing fees and upfront franchise fees are presented within Franchise and property revenues in our Consolidated Statements of Income. Additionally, from time-to-time we provide non-refundable consideration to franchisees in the form of cash or other incentives (e.g. cash payments to incent new unit openings, free or subsidized equipment, etc.). The Company’s intent in providing such consideration is to drive new unit development or same-store sales growth that will result in higher future revenues for the Company. Under Legacy Revenue GAAP, this consideration was recognized when we were obligated to provide the incentive and was presented as either a reduction to Franchise and property revenues, if cash was provided directly to the franchisee, or as Franchise and property expenses, if cash was not provided directly to the franchisee. Due to the adoption of Topic 606, such payments are capitalized and presented within Prepaid expense and other current assets or Other assets. These assets are being amortized as a reduction in Franchise and property revenues over the period of expected cash flows from the franchise agreements to which the payment relates. Property Revenues From time to time, we enter into rental agreements with franchisees for the lease or sublease of restaurant locations. These rental agreements typically originate from refranchising transactions and revenues related to the agreements are recognized as they are earned. Amounts owed under the rental agreements are typically billed and paid on a monthly basis. Revenues from rental agreements with franchisees are presented within Franchise and property revenues within our Consolidated Statements of Income. Related expenses are presented as Franchise and property expenses within our Consolidated Statements of Income and primarily include depreciation or, in the case of a sublease, rental expense. The timing and amount of revenue and expenses recognized related to the rental of restaurants we lease or sublease was not impacted by the adoption of Topic 606. Franchise Contributions for Advertising and Other Services Advertising Cooperatives Under Legacy Revenue GAAP, receipts and expenditures related to advertising cooperatives we were required to consolidate were presented on a net basis in our Consolidated Statements of Income and Consolidated Statements of Cash Flows. Additionally, assets and liabilities of the advertising cooperatives we were required to consolidate were presented within Advertising cooperative assets, restricted and Advertising cooperative liabilities, respectively, within our Consolidated Balance Sheets. In accordance with the provisions of Topic 606, we have determined we act as a principal in the transactions entered into by the advertising cooperatives we are required to consolidate based on our responsibility to define the nature of the goods or services provided and/or our responsibility to define which franchisees receive the benefit of the goods or services. Additionally, we have determined the advertising services provided to franchisees are highly interrelated with the franchise right and therefore not distinct. Franchisees remit to these consolidated advertising cooperatives a percentage of restaurant sales as consideration for providing the advertising services. As a result, revenues for advertising services are recognized when the related restaurant sales occur based on the application of the sales-based royalty exception within Topic 606. Revenues for these services are typically billed and received on a monthly basis. These revenues are presented as Franchise contributions for advertising and other services. Expenses incurred to provide these services are presented as Franchise advertising and other services expense. When revenues of an advertising cooperative exceed the related advertising expenses, advertising costs are accrued up to the amount of revenues on an annual basis. Lastly, upon adoption of Topic 606 we have reclassified assets and liabilities of advertising cooperatives we are required to consolidate to the respective balance sheet caption to which the assets and liabilities relate. Other Services On a much more limited basis, we provide goods or services to certain franchisees that are individually distinct from the franchise right because they do not require integration with other goods or services we provide. Such arrangements typically relate to supply chain, quality assurance and information technology services. In instances where we rely on third parties to provide goods or services to franchisees at our direction, we have determined we act as a principal in these transactions. The extent to which we provide such goods or services varies by brand, geographic region and, in some instances, franchisee. Similar to advertising services, receipts and expenditures related to these other services were presented on a net basis under Legacy Revenue GAAP. Upon adoption of Topic 606, revenues from the goods or services described above are presented as Franchise contributions for advertising and other services within our Consolidated Statements of Income. Expenses related to the provisioning of these goods and services are recorded in Franchise advertising and other services expense. These revenues are recognized as the goods or services are transferred to the franchisee and related expenses are recognized as incurred. Franchise Support Costs The internal costs we incur to provide support services to our franchisees for which we do not receive a direct reimbursement are charged to General and administrative expenses (“G&A”) as incurred. Certain direct costs of our franchise operations are charged to Franchise and property expenses. These costs include provisions for estimated uncollectible upfront and continuing fees, rent or depreciation expense associated with restaurants we lease or sublease to franchisees, franchise marketing funding, amortization expense for franchise-related intangible assets, value added taxes on royalties and certain other direct incremental franchise support costs. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue transaction and collected from a customer are excluded from revenue under both Legacy Revenue GAAP and Topic 606. |
Direct Marketing Costs | Direct Marketing Costs. To the extent we participate in advertising cooperatives, we expense our contributions as incurred, which are based on a percentage of sales of our Company restaurants. We charge direct marketing costs incurred outside of a cooperative to expense ratably in relation to revenues over the year in which incurred and, in the case of advertising production costs, in the year the advertisement is first shown. Deferred direct marketing costs, which are classified as prepaid expenses, consist of media and related advertising production costs that will generally be used for the first time in the next fiscal year and have historically not been significant. Advertising expenses incurred by our Company-owned restaurants are recorded within Company restaurant expenses and totaled $73 million , $96 million and $179 million in 2019, 2018 and 2017, respectively. Advertising expenses incurred on behalf of franchised restaurants by the Company are recorded within Franchise and property expenses and totaled $10 million , $35 million and $66 million in 2019, 2018 and 2017, respectively. The amounts recorded within Franchise and property expenses include $12.5 million and $25 million related to the Pizza Hut U.S. Transformation Agreement in 2018 and 2017, respectively, and $10 million and $20 million related to the KFC U.S. Acceleration Agreement in 2018 and 2017, respectively. See Note 4 for further discussion of these agreements. In 2019 and 2018 we incurred an additional $1,133 million and $1,035 million |
Share-Based Employee Compensation | Share-Based Employee Compensation. We recognize ongoing share-based payments to employees, including grants of employee stock options and stock appreciation rights (“SARs”), in the Consolidated Financial Statements as compensation cost over the service period based on their fair value on the date of grant. This compensation cost is recognized over the service period on a straight-line basis, net of an assumed forfeiture rate, for awards that actually vest. Forfeiture rates are estimated at grant date based on historical experience and compensation cost is adjusted in subsequent periods for differences in actual forfeitures from the previous estimates. We present this compensation cost consistent with the other compensation costs for the employee recipient in either Company restaurant expenses or G&A. See Note 15 for further discussion of our share-based compensation plans. |
Legal Costs | Legal Costs. Settlement costs are accrued when they are deemed probable and reasonably estimable. Anticipated legal fees related to self-insured workers' compensation, employment practices liability, general liability, automobile liability, product liability and property losses (collectively, "property and casualty losses") are accrued when deemed probable and reasonably estimable. Legal fees not related to self-insured property and casualty losses are recognized as incurred. See Note 19 for further discussion of our legal proceedings. |
Impairment or Disposal of Property, Plant and Equipment | Impairment or Disposal of Long-Lived Assets. Long-lived assets, including Property, plant and equipment (“PP&E”) as well as right-of-use operating lease assets are tested for impairment whenever events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. The assets are not recoverable if their carrying value is less than the undiscounted cash flows we expect to generate from such assets. If the assets are not deemed to be recoverable, impairment is measured based on the excess of their carrying value over their fair value. For purposes of impairment testing for our restaurants, we have concluded that an individual restaurant is the lowest level of independent cash flows unless it is more likely than not that we will refranchise restaurants as a group. We review our long-lived assets of such individual restaurants (primarily PP&E, right-of-use operating lease assets and allocated intangible assets subject to amortization) that we intend to continue operating as Company restaurants annually for impairment, or whenever events or changes in circumstances indicate that the carrying amount of a restaurant may not be recoverable. We use two consecutive years of operating losses as our primary indicator of potential impairment for our annual impairment testing of these restaurant assets. We evaluate the recoverability of these restaurant assets by comparing the estimated undiscounted future cash flows, which are based on our entity-specific assumptions, to the carrying value of such assets. For restaurant assets that are not deemed to be recoverable, we write-down an impaired restaurant to its estimated fair value, which becomes its new cost basis. Fair value is an estimate of the price a franchisee would pay for the restaurant and its related assets and is determined by discounting the estimated future after-tax cash flows of the restaurant, which include a deduction for royalties we would receive under a franchise agreement with terms substantially at market. The after-tax cash flows incorporate reasonable assumptions we believe a franchisee would make such as sales growth and margin improvement. The discount rate used in the fair value calculation is our estimate of the required rate of return that a franchisee would expect to receive when purchasing a similar restaurant and the related long-lived assets. The discount rate incorporates rates of returns for historical refranchising market transactions and is commensurate with the risks and uncertainty inherent in the forecasted cash flows. Individual restaurant-level impairment is recorded within Other (income) expense. In executing our refranchising initiatives, we most often offer groups of restaurants for sale. When we believe it is more likely than not a restaurant or groups of restaurants will be refranchised for a price less than their carrying value, but do not believe the restaurant(s) have met the criteria to be classified as held for sale, we review the restaurants for impairment. We evaluate the recoverability of these restaurant assets by comparing estimated sales proceeds plus holding period cash flows, if any, to the carrying value of the restaurant or group of restaurants. For restaurant assets that are not deemed to be recoverable, we recognize impairment for any excess of carrying value over the fair value of the restaurants, which is based on the expected net sales proceeds. To the extent ongoing agreements to be entered into with the franchisee simultaneous with the refranchising are expected to contain terms, such as royalty rates, not at prevailing market rates, we consider the off-market terms in our impairment evaluation. We recognize any such impairment charges in Refranchising (gain) loss. Refranchising (gain) loss includes the gains or losses from the sales of our restaurants to new and existing franchisees, including any impairment charges discussed above, and associated termination, relocation or retention costs associated with store-level employees of refranchised stores or employees of restaurant-support centers which we have closed due to refranchising. We recognize gains on restaurant refranchisings when the sale transaction closes and control of the restaurant operations have transferred to the franchisee. When we decide to close a restaurant, it is reviewed for impairment, which includes an estimate of sublease income that could be reasonably obtained, if any, in relation to the right-of-use operating lease asset. Additionally, depreciable lives are adjusted based on the expected disposal date. Other costs incurred when closing a restaurant such as costs of disposing of the assets as well as other facility-related expenses from previously closed stores are generally expensed as incurred. Any costs recorded upon store closure as well as any subsequent adjustments to liabilities for remaining lease obligations as a result of lease termination or changes in estimates of sublease income are recorded in Other (income) expense. To the extent we sell assets, primarily land, associated with a closed store, any gain or loss upon that sale is also recorded in Other (income) expense. Considerable management judgment is necessary to estimate future cash flows, including cash flows from continuing use, terminal value, sublease income and refranchising proceeds. Accordingly, actual results could vary significantly from our estimates. |
Guarantees | Guarantees. We recognize, at inception of a guarantee, a liability for the fair value of certain obligations undertaken. The majority of our guarantees are issued as a result of assigning our interest in obligations under operating leases as a condition to the refranchising of certain Company restaurants. We recognize a liability for the fair value of such lease guarantees upon refranchising and upon subsequent renewals of such leases when we remain secondarily liable. The related expense and any subsequent changes are included in Refranchising (gain) loss. Any expense and subsequent changes in the guarantees for other franchise support guarantees not associated with a refranchising transaction are included in Franchise and property expenses. |
Income Taxes | Income Taxes. We record deferred tax assets and liabilities for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases as well as operating loss, capital loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those differences or carryforwards are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in our Income tax provision in the period that includes the enactment date. Additionally, in determining the need for recording a valuation allowance against the carrying amount of deferred tax assets, we consider the amount of taxable income and periods over which it must be earned, actual levels of past taxable income and known trends and events or transactions that are expected to affect future levels of taxable income. Where we determine that it is more likely than not that all or a portion of an asset will not be realized, we record a valuation allowance. We recognize the benefit of positions taken or expected to be taken in our tax returns in our Income tax provision when it is more likely than not (i.e., a likelihood of more than fifty percent) that the position would be sustained upon examination by tax authorities. A recognized tax position is then measured at the largest amount of benefit that is greater than fifty percent likely of being realized upon settlement with the taxing authorities. We evaluate these amounts on a quarterly basis to ensure that they have been appropriately adjusted for audit settlements and other events we believe may impact the outcome. Changes in judgment that result in subsequent recognition, derecognition or a change in measurement of a tax position taken in a prior annual period (including any related interest and penalties) are recognized as a discrete item in the interim period in which the change occurs. We recognize accrued interest and penalties related to unrecognized tax benefits as components of our Income tax provision. We do not record a deferred tax liability for unremitted earnings of our foreign subsidiaries to the extent that the earnings meet the indefinite reversal criteria. This criteria is met if the foreign subsidiary has invested, or will invest, the earnings indefinitely. The decision as to the amount of unremitted earnings that we intend to maintain in non-U.S. subsidiaries considers items including, but not limited to, forecasts and budgets of financial needs of cash for working capital, liquidity plans and expected cash requirements in the U.S. See Note 17 for a further discussion of our income taxes. |
Fair Value Measurements | Fair Value Measurements. Fair value is the price we would receive to sell an asset or pay to transfer a liability (exit price) in an orderly transaction between market participants. For those assets and liabilities we record or disclose at fair value, we determine fair value based upon the quoted market price, if available. If a quoted market price is not available for identical assets, we determine fair value based upon the quoted market price of similar assets or the present value of expected future cash flows considering the risks involved, including counterparty performance risk if appropriate, and using discount rates appropriate for the duration. The fair values are assigned a level within the fair value hierarchy, depending on the source of the inputs into the calculation. Level 1 Inputs based upon quoted prices in active markets for identical assets. Level 2 Inputs other than quoted prices included within Level 1 that are observable for the asset, either directly or indirectly. Level 3 Inputs that are unobservable for the asset. |
Cash and Cash Equivalents | Cash and Cash Equivalents. Cash equivalents represent funds we have temporarily invested (with original maturities not exceeding three months), including short-term, highly liquid debt securities. Cash and overdraft balances that meet the criteria for right of setoff are presented net on our Consolidated Balance Sheet. |
Receivables | Receivables. The Company’s receivables are primarily generated from ongoing business relationships with our franchisees as a result of franchise agreements, as well as contributions due to consolidated advertising cooperatives. These receivables from franchisees are generally due within 30 days of the period in which the corresponding sales occur and are classified as Accounts and notes receivable, net on our Consolidated Balance Sheet. Our provision for uncollectible franchisee receivable balances is based upon pre-defined aging criteria or upon the occurrence of other events that indicate that we may not collect the balance due. Additionally, we monitor the financial condition of our franchisees and record provisions for estimated losses on receivables when we believe it probable that our franchisees will be unable to make their required payments. While we use the best information available in making our determination, the ultimate recovery of recorded receivables is also dependent upon future economic events and other conditions that may be beyond our control. Receivables that are ultimately deemed to be uncollectible, and for which collection efforts have been exhausted, are written off against the allowance for doubtful accounts. We recorded $24 million , $11 million and $5 million in net provisions within Franchise and property expenses in 2019 , 2018 and 2017 , respectively, related to uncollectible continuing fees, initial fees and rent receivables from our franchisees. Additionally, in 2019 we recorded $19 million in net provisions within Franchise advertising and other services expense related to uncollectible franchisee receivables of advertising cooperatives we are required to consolidate. Our consolidated advertising cooperatives are required to spend contributions from franchisees and us on advertising. To the extent these cooperatives were unable to collect the approximately $1.1 billion in contributions due from participating franchisees in 2019 we recorded the aforementioned bad debt provision. At the same time, we reduced advertising spending to the extent of these uncollectible franchise receivables. Thus, recorded advertising expense was reduced by the same amount as the bad debt provision within these consolidated advertising cooperatives and there was no net, direct impact to our Operating Profit in 2019. Accounts and notes receivable as well as the Allowance for doubtful accounts, including balances attributable to our consolidated advertising cooperatives, as of December 31, 2019 and 2018, respectively, are as follows: 2019 2018 Accounts and notes receivable $ 656 $ 592 Allowance for doubtful accounts (72 ) (31 ) Accounts and notes receivable, net $ 584 $ 561 Our financing receivables primarily consist of notes receivables and direct financing leases with franchisees which we enter into from time-to-time. As these receivables primarily relate to our ongoing business agreements with franchisees, we consider such receivables to have similar risk characteristics and evaluate them as one collective portfolio segment and class for determining the allowance for doubtful accounts. We monitor the financial condition of our franchisees and record provisions for estimated losses on receivables when we believe it is probable that our franchisees will be unable to make their required payments. Balances of notes receivable and direct financing leases due within one year are included in Accounts and notes receivable, net while amounts due beyond one year are included in Other assets. Amounts included in Other assets totaled $68 million (net of an allowance of less than $1 million ) and $62 million (net of an allowance of $1 million ) at December 31, 2019 and December 31, 2018 , respectively. Financing receivables that are ultimately deemed to be uncollectible, and for which collection efforts have been exhausted, are written off against the allowance for doubtful accounts. Interest income recorded on financing receivables has historically been insignificant. |
Property, Plant and Equipment | Property, Plant and Equipment. We state PP&E at cost less accumulated depreciation and amortization. We calculate depreciation and amortization on a straight-line basis over the estimated useful lives of the assets as follows: 5 to 25 years for buildings and leasehold improvements and 3 to 20 years for machinery and equipment. We suspend depreciation and amortization on assets that are held for sale. |
Leases and Leasehold Improvements | Leases and Leasehold Improvements. Starting in February 2016 and continuing into 2019, the FASB issued standards on the recognition and measurement of leases ("Topic 842"). We adopted these standards at the beginning of the year ended December 31, 2019, using a modified retrospective transition approach for leases existing at, or entered into after, the beginning of 2019 and have not recast the comparative periods presented in the Consolidated Financial Statements. The standards provide a number of optional practical expedients and policy elections in transition. We elected the ‘package of practical expedients’ under which we did not reassess under the standards our prior conclusions about lease identification, lease classification and initial direct costs. We did not elect the use-of-hindsight or the practical expedient pertaining to land easements. Refer to Note 4 for information regarding the adjustments recorded to our Consolidated Balance Sheet as of the beginning of the year ended December 31, 2019 to reflect the adoption of Topic 842. Below is information about the nature of our leases, accounting policies and assumptions subsequent to adopting Topic 842. In certain instances, we lease or sublease certain restaurants to franchisees. Our lessor and sublease portfolio primarily consists of stores that have been leased to franchisees subsequent to refranchising transactions. Our most significant leases with lease and non-lease components are leases with our franchisees that include both the right to use a restaurant as well as a license of the intellectual property associated with our Concepts’ brands. For these leases, which are primarily classified as operating leases, we account for the lease and non-lease components separately. Revenues from rental agreements with franchisees are presented within Franchise and property revenues in our Consolidated Statements of Income and related expenses (e.g. depreciation and rent expense) are presented within Franchise and property expenses. The impact of adopting Topic 842 on the accounting for our lessor and sublease portfolio was not significant. We lease land, buildings or both for certain of our Company-operated restaurants and restaurant support centers worldwide. Rental expense for leased Company-operated restaurants is presented in our Consolidated Statements of Income as Company restaurant expenses and rental expense for restaurant support centers is presented as G&A. The length of our lease terms, which vary by country and often include renewal options, are an important factor in determining the appropriate accounting for leases including the initial classification of the lease as finance (referred to as “capital” leases prior to the adoption of Topic 842) or operating as well as the timing of recognition of rent expense over the duration of the lease. We include renewal option periods in determining the term of our leases when failure to renew the lease would impose a penalty on the Company in such an amount that a renewal appears to be reasonably certain at the commencement of the lease. The primary penalty to which we are subject is the economic detriment associated with the existence of leasehold improvements that might be impaired if we choose not to continue the use of the leased property. Leasehold improvements are amortized over the shorter of their estimated useful lives or the lease term. We generally do not receive leasehold improvement incentives upon opening a store that is subject to a lease. We expense rent associated with leased land or buildings while a restaurant is being constructed whether rent is paid or we are subject to a rent holiday. Our leasing activity for other assets, including equipment, is not significant. Prior to the adoption of Topic 842 (“Legacy Lease GAAP”) liabilities for future rental payments under operating leases were not recognized on the balance sheet of the Company except when recognizing a liability was necessary to reflect the impact of recognizing rent expense on a straight-line basis. Upon the adoption of Topic 842, right-of-use assets and liabilities are recognized upon lease commencement for operating leases based on the present value of lease payments over the lease term. Similar assets and liabilities have historically always been recorded for finance leases. Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Subsequent amortization of the right-of-use asset and accretion of the lease liability for an operating lease is recognized as a single lease cost, on a straight-line basis, over the lease term. For finance leases, the right-of-use asset is depreciated on a straight-line basis over the lesser of the useful life of the leased asset or lease term. Interest on each finance lease liability is determined as the amount that results in a constant periodic discount rate on the remaining balance of the liability. As most of our leases do not provide an implicit discount rate, we use our incremental secured borrowing rate based on the information available at commencement date, including the lease term and currency, in determining the present value of lease payments for both operating and finance leases. Leases with an initial term of 12 months or less are not recorded in the Consolidated Balance Sheet; we recognize lease expense for these leases on a straight-line basis over the lease term. Right-of-use assets are assessed for impairment in accordance with our long-lived asset impairment policy, which is performed annually for restaurant-level assets or whenever events or changes in circumstances indicate that the carrying amount of a restaurant may not be recoverable. We reassess lease classification and remeasure right-of-use assets and lease liabilities when a lease is modified and that modification is not accounted for as a separate new lease or upon certain other events that require reassessment in accordance with Topic 842. The difference between operating lease rental expense recognized in our Consolidated Statements of Income and cash payments for operating leases is recognized within Other, net within Net Cash Provided by Operating Activities in our Consolidated Statements of Cash Flows. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets. From time-to-time, the Company acquires restaurants from one of our Concept’s franchisees or acquires another business. Goodwill from these acquisitions represents the excess of the cost of a business acquired over the net of the amounts assigned to assets acquired, including identifiable intangible assets and liabilities assumed. Goodwill is not amortized and has been assigned to reporting units for purposes of impairment testing. Our reporting units are our business units (which are aligned based on geography) in our KFC, Pizza Hut and Taco Bell Divisions. We evaluate goodwill for impairment on an annual basis or more often if an event occurs or circumstances change that indicate impairment might exist. We have selected the beginning of our fourth quarter as the date on which to perform our ongoing annual impairment test for goodwill. We may elect to perform a qualitative assessment for our reporting units to determine whether it is more likely than not that the fair value of the reporting unit is greater than its carrying value. If a qualitative assessment is not performed, or if as a result of a qualitative assessment it is not more likely than not that the fair value of a reporting unit exceeds its carrying value, then the reporting unit’s fair value is compared to its carrying value. Fair value is the price a willing buyer would pay for a reporting unit, and is generally estimated using discounted expected future after-tax cash flows from Company-owned restaurant operations, if any, and franchise royalties. The discount rate is our estimate of the required rate of return that a third-party buyer would expect to receive when purchasing a business from us that constitutes a reporting unit. We believe the discount rate is commensurate with the risks and uncertainty inherent in the forecasted cash flows. If the carrying value of a reporting unit exceeds its fair value, goodwill is written down to its implied fair value. If we record goodwill upon acquisition of a restaurant(s) from a franchisee and such restaurant(s) is then sold within two years of acquisition, the goodwill associated with the acquired restaurant(s) is written off in its entirety. If the restaurant is refranchised two years or more subsequent to its acquisition, we include goodwill in the carrying amount of the restaurants disposed of based on the relative fair values of the portion of the reporting unit disposed of in the refranchising and the portion of the reporting unit that will be retained. The fair value of the portion of the reporting unit disposed of in a refranchising is determined by reference to the discounted value of the future cash flows expected to be generated by the restaurant and retained by the franchisee, which includes a deduction for the anticipated, future royalties the franchisee will pay us associated with the franchise agreement entered into simultaneously with the refranchising transition. The fair value of the reporting unit retained is based on the price a willing buyer would pay for the reporting unit and includes the value of franchise agreements. Appropriate adjustments are made if a franchise agreement includes terms that are determined to not be at prevailing market rates. As such, the fair value of the reporting unit retained can include expected cash flows from future royalties from those restaurants currently being refranchised, future royalties from existing franchise businesses and company restaurant operations. As a result, the percentage of a reporting unit’s goodwill that will be written off in a refranchising transaction will be less than the percentage of the reporting unit’s Company-owned restaurants that are refranchised in that transaction and goodwill can be allocated to a reporting unit with only franchise restaurants. Our definite-lived intangible assets that are not allocated to an individual restaurant are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of the intangible asset may not be recoverable. An intangible asset that is deemed not recoverable on an undiscounted basis is written down to its estimated fair value, which is our estimate of the price a willing buyer would pay for the intangible asset based on discounted expected future after-tax cash flows. For purposes of our impairment analysis, we update the cash flows that were initially used to value the definite-lived intangible asset to reflect our current estimates and assumptions over the asset’s future remaining life. |
Derivative Financial Instruments | Derivative Financial Instruments. We use derivative instruments primarily to hedge interest rate and foreign currency risks. These derivative contracts are entered into with financial institutions. We do not use derivative instruments for trading purposes and we have procedures in place to monitor and control their use. We record all derivative instruments on our Consolidated Balance Sheet at fair value. For derivative instruments that are designated and qualify as a cash flow hedge, gain or loss on the derivative instrument is reported as a component of AOCI and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. For derivative instruments not designated as hedging instruments, the gain or loss is recognized in the results of operations immediately. As a result of the use of derivative instruments, the Company is exposed to risk that the counterparties will fail to meet their contractual obligations. To mitigate the counterparty credit risk, we only enter into contracts with carefully selected major financial institutions based upon their credit ratings and other factors, and continually assess the creditworthiness of counterparties. At December 31, 2019 and December 31, 2018, all of the counterparties to our interest rate swaps and foreign currency forwards had investment grade ratings according to the three major ratings agencies. To date, all counterparties have performed in accordance with their contractual obligations. |
Common Stock Share Repurchases | Common Stock Share Repurchases. From time-to-time, we repurchase shares of our Common Stock under share repurchase programs authorized by our Board of Directors. Shares repurchased constitute authorized, but unissued shares under the North Carolina laws under which we are incorporated. Additionally, our Common Stock has no par or stated value. Accordingly, we record the full value of share repurchases, or other deductions to Common Stock such as shares cancelled upon employee share-based award exercises, upon the trade date, against Common Stock on our Consolidated Balance Sheet except when to do so would result in a negative balance in such Common Stock account. In such instances, on a period basis, we record the cost of any further share repurchases, or other deductions to Common Stock as an addition to Accumulated deficit. Due to the large number of share repurchases of our stock over the past several years, our Common Stock balance is frequently zero at the end of any period. Accordingly, $796 million , $2,356 million and $1,915 million in share repurchases in 2019 , 2018 and 2017 , respectively, were recorded as an addition to Accumulated deficit. Additionally $18 million and $20 million related to shares cancelled upon employee share-based award exercises in 2019 and 2017 were recorded as an addition to Accumulated deficit, respectively. See Note 16 for additional information on our share repurchases. |
Pension and Post-retirement Medical Benefits | Pension and Post-retirement Medical Benefits. We measure and recognize the overfunded or underfunded status of our pension and post-retirement plans as an asset or liability in our Consolidated Balance Sheet as of our fiscal year end. The funded status represents the difference between the projected benefit obligations and the fair value of plan assets, which is calculated on a plan-by-plan basis. The projected benefit obligation and related funded status are determined using assumptions as of the end of each year. The projected benefit obligation is the present value of benefits earned to date by plan participants, including the effect of future salary increases, as applicable. The difference between the projected benefit obligations and the fair value of plan assets that has not previously been recognized in our Consolidated Statement of Income is recorded as a component of AOCI. The net periodic benefit costs associated with the Company's defined benefit pension and post-retirement medical plans are determined using assumptions regarding the projected benefit obligation and, for funded plans, the market-related value of plan assets as of the beginning of each year, or remeasurement period, if applicable. We record the service cost component of net periodic benefit costs in G&A. Non-service cost components are recorded in Other pension (income) expense. We have elected to use a market-related value of plan assets to calculate the expected return on assets, net of administrative and investment fees paid from plan assets, in net periodic benefit costs. For each individual plan we amortize into pension expense the net amounts in AOCI, as adjusted for the difference between the fair value and market-related value of plan assets, to the extent that such amounts exceed 10% of the greater of a plan’s projected benefit obligation or market-related value of assets, over the remaining service period of active participants in the plan or, for plans with no active participants, over the expected average life expectancy of the inactive participants in the plan. The market-related value of plan assets is the fair value of plan assets as of the beginning of each year adjusted for variances between actual returns and expected returns. We attribute such variances to the market-related value of plan assets evenly over five years. We record a curtailment when an event occurs that significantly reduces the expected years of future service or eliminates the accrual of defined benefits for the future services of a significant number of employees. We record a curtailment gain when the employees who are entitled to the benefits terminate their employment; we record a curtailment loss when it becomes probable a loss will occur. We recognize settlement gains or losses only when we have determined that the cost of all settlements in a year will exceed the sum of the service and interest costs within an individual plan. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Accounts and notes receivable, net | 2019 2018 Accounts and notes receivable $ 656 $ 592 Allowance for doubtful accounts (72 ) (31 ) Accounts and notes receivable, net $ 584 $ 561 |
Note 2. Summary of Significant
Note 2. Summary of Significant Accounting Policies Deferred Revenue, by Arrangement (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | |
Deferred Revenue, by Arrangement, Disclosure [Table Text Block] | Contract Liabilities Our contract liabilities are comprised of unamortized upfront fees received from franchisees. A summary of significant changes to the contract liability balance during 2019 and 2018 is presented below. Deferred Franchise Fees Balance at January 1, 2018 $ 392 Revenue recognized that was included in unamortized upfront fees received from franchisees at the beginning of the period (66 ) Increase for upfront fees associated with contracts that became effective during the period, net of amounts recognized as revenue during the period 102 Other (a) (14 ) Balance at December 31, 2018 $ 414 Revenue recognized that was included in unamortized upfront fees received from franchisees at the beginning of the period (70 ) Increase for upfront fees associated with contracts that became effective during the period, net of amounts recognized as revenue during the period 93 Other (a) 4 Balance at December 31, 2019 $ 441 (a) Includes impact of foreign currency translation as well as, in 2018, the recognition of deferred franchise fees into Refranchising (gain) loss upon the modification of existing franchise agreements when entering into master franchise agreements. |
Earnings Per Common Share ("E_2
Earnings Per Common Share ("EPS") (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Common Share | 2019 2018 2017 Net Income $ 1,294 $ 1,542 $ 1,340 Weighted-average common shares outstanding (for basic calculation) 306 322 347 Effect of dilutive share-based employee compensation 7 7 8 Weighted-average common and dilutive potential common shares outstanding (for diluted calculation) 313 329 355 Basic EPS $ 4.23 $ 4.80 $ 3.86 Diluted EPS $ 4.14 $ 4.69 $ 3.77 Unexercised employee stock options and stock appreciation rights (in millions) excluded from the diluted EPS computation (a) 2.0 2.0 2.3 (a) These unexercised employee stock options and stock appreciation rights were not included in the computation of diluted EPS because to do so would have been antidilutive for the periods presented. |
Items Affecting Comparability_2
Items Affecting Comparability of Net Income and Cash Flows (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Facility Actions [Line Items] | |
Impact of adopting Topic 606 on our Condensed Consolidated Statements of Income [Table Text Block] | The following tables reflect the impact of the adoption of Topic 606 on our Consolidated Statement of Income for the year ended December 31, 2018 and our Consolidated Balance Sheet as of December 31, 2018. CONSOLIDATED STATEMENT OF INCOME Year ended 12/31/2018 Revenues As Reported Impact Balances under Legacy Revenue GAAP Company sales $ 2,000 $ — $ 2,000 Franchise and property revenues 2,482 43 2,525 Franchise contributions for advertising and other services 1,206 (1,206 ) — Total revenues 5,688 (1,163 ) 4,525 Costs and Expenses, Net Company restaurant expenses 1,634 — 1,634 General and administrative expenses 895 — 895 Franchise and property expenses 188 27 215 Franchise advertising and other services expense 1,208 (1,208 ) — Refranchising (gain) loss (540 ) 4 (536 ) Other (income) expense 7 — 7 Total costs and expenses, net 3,392 (1,177 ) 2,215 Operating Profit 2,296 14 (a) 2,310 Investment (income) expense, net (9 ) — (9 ) Other pension (income) expense 14 — 14 Interest expense, net 452 — 452 Income before income taxes 1,839 14 1,853 Income tax provision (benefit) 297 3 300 Net Income $ 1,542 $ 11 $ 1,553 Basic Earnings Per Common Share $ 4.80 $ 0.03 $ 4.83 Diluted Earnings Per Common Share $ 4.69 $ 0.03 $ 4.72 (a) Includes $23 million of franchise incentive payments made to or on behalf of franchisees during 2018 that under Legacy Revenue GAAP would have been recognized as expense in full in 2018. Due to the size and nature of such payments, we historically would not have allocated their impact to our Divisional results. Upon the adoption of Topic 606, these payments have been capitalized as assets. |
Revenue Recognition adjustments made to Condensed Consolidated Balance Sheet [Table Text Block] | CONSOLIDATED BALANCE SHEET As Reported 12/31/2018 Impact Balances under Legacy Revenue GAAP 12/31/2018 ASSETS Current Assets Cash and cash equivalents $ 292 $ (13 ) $ 279 Accounts and notes receivable, net 561 (120 ) 441 Prepaid expenses and other current assets 354 (107 ) 247 Advertising cooperative assets, restricted — 241 241 Total Current Assets 1,207 1 1,208 Property, plant and equipment, net 1,237 (2 ) 1,235 Goodwill 525 — 525 Intangible assets, net 242 (16 ) 226 Other assets 724 (127 ) 597 Deferred income taxes 195 (25 ) 170 Total Assets $ 4,130 $ (169 ) $ 3,961 LIABILITIES AND SHAREHOLDERS’ DEFICIT Current Liabilities Accounts payable and other current liabilities $ 911 $ (287 ) $ 624 Income taxes payable 69 — 69 Short-term borrowings 321 — 321 Advertising cooperative liabilities — 241 241 Total Current Liabilities 1,301 (46 ) 1,255 Long-term debt 9,751 — 9,751 Other liabilities and deferred credits 1,004 (354 ) 650 Total Liabilities 12,056 (400 ) 11,656 Shareholders’ Deficit Accumulated deficit (7,592 ) 251 (7,341 ) Accumulated other comprehensive loss (334 ) (20 ) (354 ) Total Shareholders’ Deficit (7,926 ) 231 (7,695 ) Total Liabilities and Shareholders’ Deficit $ 4,130 $ (169 ) $ 3,961 CONSOLIDATED BALANCE SHEET As Reported 12/31/2017 Adjustments Balances with Adoption of Topic 606 1/1/2018 ASSETS Current Assets Cash and cash equivalents $ 1,522 $ 11 $ 1,533 Accounts and notes receivable, net 400 112 512 Prepaid expenses and other current assets 384 76 (a) 460 Advertising cooperative assets, restricted 201 (201 ) — Total Current Assets 2,507 (2 ) 2,505 Property, plant and equipment, net 1,594 2 1,596 Goodwill 512 — 512 Intangible assets, net 214 9 223 Other assets 345 118 463 Deferred income taxes 139 26 165 Total Assets $ 5,311 $ 153 $ 5,464 LIABILITIES AND SHAREHOLDERS’ DEFICIT Current Liabilities Accounts payable and other current liabilities $ 813 $ 220 $ 1,033 Income taxes payable 123 — 123 Short-term borrowings 375 — 375 Advertising cooperative liabilities 201 (201 ) — Total Current Liabilities 1,512 19 1,531 Long-term debt 9,429 — 9,429 Other liabilities and deferred credits 704 353 1,057 Total Liabilities 11,645 372 12,017 Shareholders’ Deficit Accumulated deficit (6,063 ) (240 ) (6,303 ) Accumulated other comprehensive loss (271 ) 21 (250 ) Total Shareholders’ Deficit (6,334 ) (219 ) (6,553 ) Total Liabilities and Shareholders’ Deficit $ 5,311 $ 153 $ 5,464 (a) Includes $58 million of restricted cash related to advertising cooperatives. These balances can only be used to settle obligations of the respective cooperatives. |
Impact of Change in Reporting Calendar [Table Text Block] | |
Refranchising (gain) loss [Member] | |
Facility Actions [Line Items] | |
Facility Actions | Refranchising (Gain) Loss The Refranchising (gain) loss by our Divisional reportable segments is presented below. Given the size and volatility of refranchising initiatives, our chief operating decision maker ("CODM") does not consider the impact of Refranchising (gain) loss when assessing Divisional segment performance. As such, we do not allocate such gains and losses to our Divisional segments for performance reporting purposes. During the years ended December 31, 2019, 2018 and 2017, we refranchised 25 , 660 and 1,470 restaurants, respectively. Additionally, during the year ended December 31, 2019, we sold certain restaurant assets associated with existing franchise restaurants to the franchisee. We received $110 million , $825 million and $1,773 million in pre-tax refranchising proceeds in 2019, 2018 and 2017, respectively. A summary of Refranchising (gain) loss is as follows: Refranchising (gain) loss 2019 2018 2017 KFC Division $ (6 ) $ (240 ) $ (581 ) Pizza Hut Division — 13 (16 ) Taco Bell Division (31 ) (313 ) (486 ) Worldwide $ (37 ) $ (540 ) $ (1,083 ) As a result of classifying restaurant and related assets as held for sale and ceasing depreciation expense, depreciation expense was reduced versus what would have otherwise been recorded by less than $1 million , $3 million and $10 million during the years ended December 31, 2019, 2018 and 2017, respectively. Our CODM does not consider the impact of these depreciation reductions, which were recorded within Company restaurant expenses, when assessing Divisional segment performance. These depreciation reductions were recorded as an unallocated benefit and were not allocated to the Division segments resulting in depreciation expense continuing to be recorded within our Divisional results at the rate at which it was prior to the held for sale classification. |
Note 5. Revenue Recognition (Ta
Note 5. Revenue Recognition (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Disaggregation of Revenue [Table Text Block] | Disaggregation of Total Revenues The following table disaggregates revenue by Concept, for our two most significant markets based on Operating Profit and for all other markets. We believe this disaggregation best reflects the extent to which the nature, amount, timing and uncertainty of our revenues and cash flows are impacted by economic factors. 2019 KFC Division Pizza Hut Division Taco Bell Division Total U.S. Company sales $ 74 $ 21 $ 919 $ 1,014 Franchise revenues 175 282 602 1,059 Property revenues 20 6 44 70 Franchise contributions for advertising and other services 10 318 483 811 China Franchise revenues 214 60 — 274 Other Company sales 497 33 2 532 Franchise revenues 912 246 27 1,185 Property revenues 69 3 — 72 Franchise contributions for advertising and other services 520 58 2 580 $ 2,491 $ 1,027 $ 2,079 $ 5,597 2018 KFC Division Pizza Hut Division Taco Bell Division Total U.S. Company sales $ 72 $ 37 $ 1,034 $ 1,143 Franchise revenues 171 284 539 994 Property revenues 23 4 27 54 Franchise contributions for advertising and other services 9 269 428 706 China Franchise revenues 201 59 — 260 Other Company sales 822 32 3 857 Franchise revenues 825 248 24 1,097 Property revenues 74 3 — 77 Franchise contributions for advertising and other services 447 52 1 500 $ 2,644 $ 988 $ 2,056 $ 5,688 |
Deferred Revenue, by Arrangement, Disclosure [Table Text Block] | Contract Liabilities Our contract liabilities are comprised of unamortized upfront fees received from franchisees. A summary of significant changes to the contract liability balance during 2019 and 2018 is presented below. Deferred Franchise Fees Balance at January 1, 2018 $ 392 Revenue recognized that was included in unamortized upfront fees received from franchisees at the beginning of the period (66 ) Increase for upfront fees associated with contracts that became effective during the period, net of amounts recognized as revenue during the period 102 Other (a) (14 ) Balance at December 31, 2018 $ 414 Revenue recognized that was included in unamortized upfront fees received from franchisees at the beginning of the period (70 ) Increase for upfront fees associated with contracts that became effective during the period, net of amounts recognized as revenue during the period 93 Other (a) 4 Balance at December 31, 2019 $ 441 (a) Includes impact of foreign currency translation as well as, in 2018, the recognition of deferred franchise fees into Refranchising (gain) loss upon the modification of existing franchise agreements when entering into master franchise agreements. |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Table Text Block] | We expect to recognize contract liabilities as revenue over the remaining term of the associated franchise agreement as follows: Less than 1 year $ 65 1 - 2 years 60 2 - 3 years 56 3 - 4 years 51 4 - 5 years 46 Thereafter 163 Total $ 441 We have applied the optional exemption, as provided for under Topic 606, which allows us to not disclose the transaction price allocated to unsatisfied performance obligations when the transaction price is a sales-based royalty. |
Supplemental Cash Flow Data (Ta
Supplemental Cash Flow Data (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Supplemental Cash Flow Elements [Abstract] | |
Cash paid for interest and income taxes, and significant non-cash investing and financing activities | 2019 2018 2017 Cash Paid For: Interest $ 497 $ 455 $ 442 Income taxes 283 279 346 Significant Non-Cash Investing and Financing Activities: Finance lease obligations incurred $ 14 $ 4 $ 8 Finance lease and other debt obligations transferred through refranchising (1 ) (24 ) (35 ) Reconciliation of Cash and cash equivalents to Consolidated Statements of Cash Flows: Cash and cash equivalents as presented in Consolidated Balance Sheets $ 605 $ 292 $ 1,522 Restricted cash included in Prepaid expenses and other current assets (a) 138 151 60 Restricted cash and restricted cash equivalents included in Other assets (b) 25 31 17 Cash, Cash Equivalents and Restricted Cash as presented in Consolidated Statements of Cash Flows (c) $ 768 $ 474 $ 1,599 (a) Restricted cash within Prepaid expenses and other current assets reflects Taco Bell Securitization interest reserves (See Note 10) and the cash related to advertising cooperatives that we consolidate that can only be used to settle obligations of the respective cooperatives. (b) Primarily trust accounts related to our self-insurance program. (c) Upon adoption of Topic 606 we reclassified cash of $11 million and restricted cash of $58 million , respectively, from Advertising cooperative assets, restricted to Cash and cash equivalents and Prepaid expenses and other current assets. These amounts are included in the Beginning of Year balance of Cash, Cash Equivalents, Restricted Cash and Restricted Cash equivalents in our Consolidated Statement of Cash Flows for the year ended December 31, 2018. |
Other (Income) Expense (Tables)
Other (Income) Expense (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Other Income and Expenses [Abstract] | |
Other (Income) Expense Table | 2019 2018 2017 Foreign exchange net (gain) loss and other (a) $ (1 ) $ 1 $ 7 Closure and impairment expense 5 6 3 Other (income) expense $ 4 $ 7 $ 10 |
Supplemental Balance Sheet In_2
Supplemental Balance Sheet Information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Supplemental Balance Sheet Information Disclosure [Abstract] | |
Schedule of Other Assets, Noncurrent [Table Text Block] | |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets 2019 2018 Income tax receivable $ 39 $ 36 Restricted cash 138 151 Assets held for sale (a) 25 24 Other prepaid expenses and current assets 136 143 Prepaid expenses and other current assets $ 338 $ 354 |
Property, Plant and Equipment | Property, Plant and Equipment 2019 2018 Land $ 408 $ 422 Buildings and improvements 1,325 1,349 Finance leases, primarily buildings 68 59 Machinery, equipment and other 505 523 Property, plant and equipment, gross 2,306 2,353 Accumulated depreciation and amortization (1,136 ) (1,116 ) Property, plant and equipment, net $ 1,170 $ 1,237 |
Accounts Payable and Other Current Liabilities | Accounts Payable and Other Current Liabilities 2019 2018 Accounts payable $ 173 $ 202 Accrued compensation and benefits 223 206 Accrued advertising 96 108 Operating lease liabilities (b) 67 — Accrued taxes, other than income taxes 52 48 Other current liabilities 349 347 Accounts payable and other current liabilities $ 960 $ 911 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in the carrying amount of goodwill | The changes in the carrying amount of goodwill are as follows: KFC Pizza Hut Taco Bell Worldwide Goodwill, net as of December 31, 2017 (a) $ 247 $ 162 $ 103 $ 512 Disposal and other, net (b) (17 ) (5 ) (4 ) (26 ) QuikOrder acquisition (c) — 39 — 39 Goodwill, net as of December 31, 2018 (a) $ 230 $ 196 $ 99 $ 525 Disposal and other, net (b) 3 3 (1 ) 5 Goodwill, net as of December 31, 2019 (a) $ 233 $ 199 $ 98 $ 530 (a) Goodwill, net includes $17 million of accumulated impairment losses for each year presented related to our Pizza Hut segment. (b) Disposals and other, net includes the impact of foreign currency translation on existing balances and goodwill write-offs associated with refranchising. (c) In December 2018, we completed the acquisition of QuikOrder, LLC, an online ordering software and service provider for the restaurant industry (“QuikOrder”), who was a provider of services to Company and franchise restaurants of our Pizza Hut U.S. business for nearly two decades. The purchase price allocated for accounting purposes of $77 million consisted of cash, net of cash acquired, in the amount of $66 million , settlement of a prepaid asset of $6 million related to our preexisting contractual relationship with QuikOrder and contingent consideration of $5 million . The contingent consideration was paid in the year ended December 31, 2019. The acquisition was part of our strategy to deliver an easy and personalized online ordering experience and accelerate digital innovation. Subsequent to the acquisition, fees paid by franchisees for use of the QuikOrder software are being presented within Franchise contributions for advertising and other services. Associated costs we incur are being presented within Franchise advertising and other services expense and G&A. The primary assets recorded as a result of the purchase price allocation were goodwill of $39 million and amortizable intangible assets (primarily software) of $33 million . The goodwill recorded resulted from increased synergies expected to be achieved through leveraging our scale and resources to enhance the services previously offered by QuikOrder. The goodwill amortization is deductible for tax purposes and has been allocated to the Pizza Hut U.S. reporting unit. The pro forma impact on our results of operations if the acquisition had been completed as of the beginning of 2017 would not have been significant. The direct transaction costs associated with the acquisition were also not material and were expensed as incurred. |
Schedule Of Finite And Indefinite Lived Intangible Assets By Major Class | Intangible assets, net for the years ended 2019 and 2018 are as follows: 2019 2018 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Definite-lived intangible assets Capitalized software costs $ 306 $ (130 ) $ 319 $ (156 ) Reacquired franchise rights 38 (32 ) 37 (30 ) Franchise contract rights 100 (83 ) 99 (79 ) Lease tenancy rights 5 (1 ) 11 (1 ) Other 38 (28 ) 38 (27 ) $ 487 $ (274 ) $ 504 $ (293 ) Indefinite-lived intangible assets KFC trademark $ 31 $ 31 |
Short-term Borrowings and Lon_2
Short-term Borrowings and Long-term Debt (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Debt [Table Text Block] | 2019 2018 Short-term Borrowings Current maturities of long-term debt $ 437 $ 331 Other 4 — 441 331 Less current portion of debt issuance costs and discounts (10 ) (10 ) Short-term borrowings $ 431 $ 321 Long-term Debt Securitization Notes $ 2,898 $ 2,928 Subsidiary Senior Unsecured Notes 2,850 2,850 Term Loan A Facility 463 488 Term Loan B Facility 1,935 1,955 YUM Senior Unsecured Notes 2,425 1,875 Finance lease obligations (See Note 11) 77 71 $ 10,648 $ 10,167 Less debt issuance costs and discounts (80 ) (85 ) Less current maturities of long-term debt (437 ) (331 ) Long-term debt $ 10,131 $ 9,751 2019 2018 Carrying Value Fair Value (Level 2) Carrying Value Fair Value (Level 2) Securitization Notes (a) $ 2,898 $ 3,040 $ 2,928 $ 2,967 Subsidiary Senior Unsecured Notes (b) 2,850 3,004 2,850 2,733 Term Loan A Facility (b) 463 464 488 479 Term Loan B Facility (b) 1,935 1,949 1,955 1,915 YUM Senior Unsecured Notes (b) 2,425 2,572 1,875 1,798 (a) We estimated the fair value of the Securitization Notes by obtaining broker quotes from two separate brokerage firms that are knowledgeable about the Company’s Securitization Notes and, at times, trade these notes. The markets in which the Securitization Notes trade are not considered active markets. (b) We estimated the fair value of the YUM and Subsidiary Senior Unsecured Notes, Term Loan A Facility, and Term Loan B Facility using market quotes and calculations based on market rates. |
Debt Instrument [Line Items] | |
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments | e. As included in the table above, on September 11, 2019, Yum! Brands, Inc. issued $800 million aggregate principal amount of 4.75% YUM Senior Unsecured Notes due January 15, 2030 (the “2030 Notes”). The net proceeds from the issuance were used to repay in full $250 million aggregate principal amount of YUM Senior Unsecured Notes that matured in September 2019, to repay the then outstanding borrowings under our $1 billion revolving facility and for general corporate purposes. Interest on the 2030 Notes is payable semiannually in arrears on January 15 and July 15 of each year. The Company incurred debt issuance costs of $10 million in connection with the issuance of the 2030 Notes. These issuance costs are recorded as a reduction in Long-term debt on our Consolidated Balance Sheet. The YUM Senior Unsecured Notes represent senior, unsecured obligations and rank equally in right of payment with all of our existing and future unsecured unsubordinated indebtedness. Our YUM Senior Unsecured Notes contain cross-default provisions whereby the acceleration of the maturity of any of our indebtedness in a principal amount in excess of $50 million will constitute a default under the YUM Senior Unsecured Notes unless such indebtedness is discharged, or the acceleration of the maturity of that indebtedness is annulled, within 30 days after notice . The annual maturities of all Short-term borrowings and Long-term debt as of December 31, 2019 , excluding finance lease obligations of $77 million |
Senior Unsecured Notes [Member] | |
Debt Instrument [Line Items] | |
Senior Unsecured Notes issued that remain outstanding | Interest Rate Issuance Date Maturity Date Principal Amount (in millions) Stated Effective (a) October 2007 November 2037 $ 325 6.88 % 7.45 % August 2010 November 2020 $ 350 3.88 % 4.01 % August 2011 November 2021 $ 350 3.75 % 3.88 % October 2013 November 2023 $ 325 3.88 % 4.01 % October 2013 November 2043 $ 275 5.35 % 5.42 % September 2019 January 2030 $ 800 4.75 % 4.90 % (a) Includes the effects of the amortization of any (1) premium or discount; (2) debt issuance costs; and (3) gain or loss upon settlement of related treasury locks and forward starting interest rate swaps utilized to hedge the interest rate risk prior to debt issuance. |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Future minimum commitments and amounts to be received as lessor or sublessor under non-cancelable leases | |
Details of rental expense and income |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments, Gain (Loss) [Table Text Block] | Gains and losses on derivative instruments designated as cash flow hedges recognized in OCI and reclassifications from AOCI into Net Income: Gains/(Losses) Recognized in OCI (Gains)/Losses Reclassified from AOCI into Net Income 2019 2018 2017 2019 2018 2017 Interest rate swaps $ (71 ) $ (3 ) $ 4 $ (17 ) $ (19 ) $ 2 Foreign currency contracts 20 22 (56 ) (8 ) (20 ) 56 Income tax benefit/(expense) 16 1 1 4 5 (3 ) |
Fair Value Disclosures (Tables)
Fair Value Disclosures (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements, Recurring Basis | The following table presents fair values for those assets and liabilities measured at fair value on a recurring basis and the level within the fair value hierarchy in which the measurements fall. Fair Value Consolidated Balance Sheet Level 2019 2018 Assets Interest Rate Swaps Prepaid expenses and other current assets 2 $ 6 $ 21 Foreign Currency Contracts Prepaid expenses and other current assets 2 — 5 Interest Rate Swaps Other assets 2 3 29 Investment in Grubhub Common Stock Other assets 1 137 214 Other Investments Other assets 1 43 27 Liabilities Interest Rate Swaps Other liabilities and deferred credits 2 71 23 Foreign Currency Contracts Other liabilities and deferred credits 2 — 24 |
Fair Value Measurements and Total Losses, Non-Recurring Basis | During the years ended December 31, 2019 and December 31, 2018, we recognized non-recurring fair value measurements of $4 million and $1 million , respectively, related to restaurant-level impairment. Restaurant-level impairment charges are recorded in Other (income) expense and resulted primarily from our impairment evaluation of long-lived assets of individual restaurants that |
Pension, Retiree Medical and _2
Pension, Retiree Medical and Retiree Savings Plans (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |
Funded status of pension plans | The following chart summarizes the balance sheet impact, as well as benefit obligations, assets, and funded status associated with our two significant U.S. pension plans. The actuarial valuations for all plans reflect measurement dates coinciding with our fiscal year end. 2019 2018 Change in benefit obligation: Benefit obligation at beginning of year $ 873 $ 1,007 Service cost 6 8 Interest cost 39 38 Plan amendments 2 1 Special termination benefits — 1 Benefits paid (57 ) (73 ) Settlement payments (1 ) — Actuarial (gain) loss 153 (109 ) Benefit obligation at end of year $ 1,015 $ 873 A significant component of the overall increase in the Company's benefit obligation for the year ended December 31, 2019 was due to an actuarial loss, which was primarily due to a decrease in the discount rate used to measure our benefit obligation from 4.60% at December 31, 2018 to 3.50% at December 31, 2019 . A significant component of the overall decrease in the Company's benefit obligation for the year ended December 31, 2018 was due to an actuarial gain, which was primarily due to an increase in the discount rate used to measure our benefit obligation from 3.90% at December 31, 2017 to 4.60% at December 31, 2018 . Change in plan assets: Fair value of plan assets at beginning of year $ 755 $ 864 Actual return on plan assets 176 (49 ) Employer contributions 12 13 Benefits paid (57 ) (73 ) Fair value of plan assets at end of year $ 886 $ 755 Funded status at end of year $ (129 ) $ (118 ) |
Amounts recognized in the Consolidated Balance Sheet | Amounts recognized in the Consolidated Balance Sheet: 2019 2018 Accrued benefit liability - current $ (4 ) $ (5 ) Accrued benefit liability - non-current (125 ) (113 ) $ (129 ) $ (118 ) |
Pension plans with an accumulated benefit obligation in excess of pan assets | Information for pension plans with an accumulated benefit obligation in excess of plan assets: 2019 2018 Projected benefit obligation $ 1,015 $ 873 Accumulated benefit obligation 984 849 Fair value of plan assets 886 755 |
Pension plans with a projected benefit obligation in excess of plan assets | Information for pension plans with a projected benefit obligation in excess of plan assets: 2019 2018 Projected benefit obligation $ 1,015 $ 873 Accumulated benefit obligation 984 849 Fair value of plan assets 886 755 |
Components of net periodic benefit cost | Components of net periodic benefit cost: 2019 2018 2017 Service cost $ 6 $ 8 $ 10 Interest cost 39 38 41 Amortization of prior service cost (a) 6 5 6 Expected return on plan assets (44 ) (44 ) (45 ) Amortization of net loss 1 16 5 Net periodic benefit cost $ 8 $ 23 $ 17 Additional (gain) loss recognized due to: Settlement charges (b) $ 3 $ — $ 19 Special termination benefits $ — $ 1 $ 2 Pension data adjustment (c) $ — $ — $ 22 (a) Prior service costs are amortized on a straight-line basis over the average remaining service period of employees expected to receive benefits. (b) Settlement losses result when benefit payments exceed the sum of the service cost and interest cost within a plan during the year. These losses were recorded in Other pension (income) expense. (c) Reflects a non-cash, out-of-year charge related to the adjustment of certain historical deferred vested liability balances in the Plan during the first quarter of 2017 recorded in Other pension (income) expense. See Note 4. |
Pension losses in accumulated other comprehensive income (loss) | Pension gains (losses) in AOCI: 2019 2018 Beginning of year $ (123 ) $ (160 ) Net actuarial gain (loss) (22 ) 17 Curtailments — — Amortization of net loss 1 16 Amortization of prior service cost 6 5 Prior service cost (2 ) (1 ) Settlement charges 4 — End of year $ (136 ) $ (123 ) |
Schedule of Accumulated pre-tax losses recognized in Accumulated Other Comprehensive Income | Accumulated pre-tax losses recognized within AOCI: 2019 2018 Actuarial net loss $ (118 ) $ (101 ) Prior service cost (18 ) (22 ) $ (136 ) $ (123 ) |
Weighted-average assumptions used to determine benefit obligations and net periodic benefit cost | Weighted-average assumptions used to determine benefit obligations at the measurement dates: 2019 2018 Discount rate 3.50 % 4.60 % Rate of compensation increase 3.00 % 3.00 % Weighted-average assumptions used to determine the net periodic benefit cost for fiscal years: 2019 2018 2017 (a) Discount rate 4.60 % 3.90 % 4.53 % Long-term rate of return on plan assets 5.75 % 5.65 % 6.06 % Rate of compensation increase 3.00 % 3.75 % 3.75 % (a) Reflects a weighted average due to interim re-measurements in 2017. |
Fair values of pension plan assets | The fair values of our pension plan assets at December 31, 2019 and December 31, 2018 by asset category and level within the fair value hierarchy are as follows: 2019 2018 Level 1: Cash $ 5 $ 3 Cash Equivalents (a) 13 10 Fixed Income Securities - U.S. Corporate (b) 161 140 Equity Securities – U.S. Large cap (b) 268 215 Equity Securities – U.S. Mid cap (b) 44 35 Equity Securities – U.S. Small cap (b) 43 34 Equity Securities – Non-U.S. (b) 88 74 Level 2: Fixed Income Securities – U.S. Corporate (c) 120 106 Fixed Income Securities – U.S. Government and Government Agencies (d) 274 161 Fixed Income Securities – Other (d) 39 18 Total fair value of plan assets (e) $ 1,055 $ 796 (a) Short-term investments in money market funds. (b) Securities held in common trusts. (c) Investments held directly by the Plan. (d) Includes securities held in common trusts and investments held directly by the Plan. (e) 2019 and 2018 exclude net unsettled trade payables of $169 million and $41 million , respectively. |
Expected benefit payments | The benefits expected to be paid in each of the next five years and in the aggregate for the five years thereafter are set forth below: Year ended: 2020 $ 43 2021 47 2022 49 2023 52 2024 53 2025 - 2029 287 |
Share-based and Deferred Comp_2
Share-based and Deferred Compensation Plans (Tables) | 12 Months Ended | |
Dec. 31, 2019 | ||
Compensation Related Costs [Abstract] | ||
Weighted-average assumptions used in the Black-Scholes option-pricing model | We estimated the fair value of each stock option and SAR award as of the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions: 2019 2018 2017 Risk-free interest rate 2.5 % 2.5 % 1.9 % Expected term 6.5 years 6.5 years 6.4 years Expected volatility 22.0 % 22.0 % 22.9 % Expected dividend yield 1.8 % 1.8 % 1.8 % | |
Summary of award activity | Stock Options and SARs Shares (in thousands) Weighted-Average Exercise Price Weighted- Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in millions) Outstanding at the beginning of the year 16,191 $ 51.84 Granted 2,332 93.52 Exercised (3,210 ) 38.16 Forfeited or expired (449 ) 75.29 Outstanding at the end of the year 14,864 (a) 60.76 5.62 $ 594 Exercisable at the end of the year 9,283 $ 49.38 4.10 $ 477 (a) Outstanding awards include 782 options and 14,082 SARs with weighted average exercise prices of $45.03 and $61.64 , respectively. Outstanding awards represent YUM awards held by employees of both YUM and Yum China. | [1] |
Impact on net income | The components of share-based compensation expense and the related income tax benefits are shown in the following table: 2019 2018 2017 Options and SARs $ 39 $ 37 $ 30 Restricted Stock Units 12 6 26 Performance Share Units 8 7 9 Total Share-based Compensation Expense $ 59 $ 50 (a) $ 65 (a) Deferred Tax Benefit recognized $ 9 $ 9 $ 22 (b) EID compensation expense not share-based $ 17 $ (2 ) $ 12 (a) Includes $3 million of appreciation and $18 million of depreciation in the market price of Yum China's stock in 2018 and 2017, respectively. See Note 4. (b) Deferred tax benefit recognized does not reflect the impact of the Tax Act. See Note 17. | |
[1] | Outstanding awards include 782 options and 14,082 SARs with weighted average exercise prices of $45.03 and $61.64 , respectively. Outstanding awards represent YUM awards held by employees of both YUM and Yum China. |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
Repurchase Of Shares Of Common Stock | Shares Repurchased (thousands) Dollar Value of Shares Repurchased Authorization Date 2019 2018 2017 2019 2018 2017 August 2018 7,788 10,003 — 810 894 — November 2017 — 18,240 — — 1,500 — November 2016 — — 26,561 — — 1,915 Total 7,788 (a) 28,243 (a) 26,561 (b) $ 810 (a) $ 2,394 (a) $ 1,915 (b) (a) 2019 amount excludes and 2018 amount includes the effect of $5 million in share repurchases ( 0.1 million shares) with trade dates on, or prior to, December 31, 2018 but settlement dates subsequent to December 31, 2018. (b) 2017 amount excludes the effect of $45 million in share repurchases ( 0.7 million shares) with trade dates prior to December 31, 2016 but settlement dates subsequent to December 31, 2016. |
Schedule of changes in accumulated other comprehensive income | Changes in AOCI are presented below. Translation Adjustments and Gains (Losses) From Intra-Entity Transactions of a Long-Term Nature (a) Pension and Post-Retirement Benefits (b) Derivative Instruments (c) Total Balance at December 31, 2017, net of tax $ (174 ) $ (106 ) $ 9 $ (271 ) Adoption of accounting standards 21 (d) (17 ) (e) (2 ) (e) 2 OCI, net of tax Gains (losses) arising during the year classified into AOCI, net of tax (88 ) 24 20 (44 ) (Gains) losses reclassified from AOCI, net of tax (4 ) 17 (34 ) (21 ) (92 ) 41 (14 ) (65 ) Balance at December 31, 2018, net of tax $ (245 ) $ (82 ) $ (7 ) $ (334 ) OCI, net of tax Gains (losses) arising during the year classified into AOCI, net of tax 24 (30 ) (35 ) (41 ) (Gains) losses reclassified from AOCI, net of tax — 8 (21 ) (13 ) 24 (22 ) (56 ) (54 ) Balance at December 31, 2019, net of tax $ (221 ) $ (104 ) $ (63 ) $ (388 ) (a) Amounts reclassified from AOCI are due to substantially complete liquidations of foreign entities related to the KFC and Pizza Hut Brazil refranchising transactions during 2018. (b) Amounts reclassified from AOCI for pension and post-retirement benefit plans losses during 2019 include amortization of net losses of $2 million , amortization of prior service cost of $5 million , settlement charges of $3 million and related income tax benefit of $2 million . Amounts reclassified from AOCI for pension and post-retirement benefit plan losses during 2018 include amortization of net losses of $17 million , amortization of prior service cost of $5 million and related income tax benefit of $5 million . See Note 14. (c) See Note 12 for details on amounts reclassified from AOCI. (d) Represents the impact of foreign currency translation from the adoption of Topic 606. See Notes 2 and 4. (e) |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income before income taxes | U.S. and foreign income before taxes are set forth below: 2019 2018 2017 U.S. $ 466 $ 726 $ 662 Foreign 907 1,113 1,612 $ 1,373 $ 1,839 $ 2,274 |
Details of income tax provision (benefit) | The details of our income tax provision (benefit) are set forth below: 2019 2018 2017 Current: Federal $ 129 $ 102 $ (2 ) Foreign 166 181 290 State 16 25 12 $ 311 $ 308 $ 300 Deferred: Federal $ (16 ) $ (24 ) $ 603 Foreign (213 ) 5 19 State (3 ) 8 12 $ (232 ) $ (11 ) $ 634 $ 79 $ 297 $ 934 |
Effective income tax and tax rate reconciliation | The reconciliation of income taxes calculated at the U.S. federal statutory rate to our effective tax rate is set forth below: 2019 2018 2017 U.S. federal statutory rate 21.0 % 21.0 % 35.0 % State income tax, net of federal tax 0.8 1.0 0.5 Statutory rate differential attributable to foreign operations 1.6 (12.3 ) (9.3 ) Adjustments to reserves and prior years 4.2 2.8 0.5 Share-based compensation (4.0 ) (2.5 ) (5.1 ) Change in valuation allowances (2.6 ) 8.5 1.5 Intercompany restructuring (16.1 ) — — Tax Act Enactment — (1.9 ) 19.1 Other, net 0.8 (0.4 ) (1.1 ) Effective income tax rate 5.7 % 16.2 % 41.1 % |
Details of deferred tax assets (liabilities) | The details of 2019 and 2018 deferred tax assets (liabilities) are set forth below: 2019 2018 Operating losses $ 176 $ 180 Capital losses 3 3 Tax credit carryforwards 230 266 Employee benefits 85 72 Share-based compensation 55 62 Self-insured casualty claims 6 7 Lease-related liabilities 199 43 Various liabilities 43 43 Intangible assets 602 8 Property, plant and equipment 21 19 Deferred income and other 85 45 Gross deferred tax assets 1,505 748 Deferred tax asset valuation allowances (787 ) (454 ) Net deferred tax assets $ 718 $ 294 Intangible assets, including goodwill $ (40 ) $ (42 ) Property, plant and equipment (44 ) (33 ) Operating lease right-of-use assets (156 ) — Other (31 ) (31 ) Gross deferred tax liabilities $ (271 ) $ (106 ) Net deferred tax assets (liabilities) $ 447 $ 188 Reported in Consolidated Balance Sheets as: Deferred income taxes $ 447 $ 195 Other liabilities and deferred credits — (7 ) $ 447 $ 188 |
Loss carryforwards, by year of expiration | Year of Expiration 2020 2021-2024 2025-2038 Indefinitely Total Foreign $ 10 $ 26 $ 36 $ 336 $ 408 U.S. state 2 111 1,021 — 1,134 U.S. federal — 36 178 — 214 $ 12 $ 173 $ 1,235 $ 336 $ 1,756 |
Unrecognized tax benefits reconciliation | 2019 2018 Beginning of Year $ 113 $ 100 Additions on tax positions - current year 84 19 Additions for tax positions - prior years 54 — Reductions for tax positions - prior years (30 ) (5 ) Reductions for settlements (31 ) — Reductions due to statute expiration (2 ) (1 ) Foreign currency translation adjustment — — End of Year $ 188 $ 113 |
Reportable Operating Segments (
Reportable Operating Segments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Revenues 2019 2018 2017 KFC Division (a) $ 2,491 $ 2,644 $ 3,110 Pizza Hut Division (a) 1,027 988 893 Taco Bell Division (a) 2,079 2,056 1,880 Unallocated (b)(f) — — (5 ) $ 5,597 $ 5,688 $ 5,878 Operating Profit 2019 2018 2017 KFC Division $ 1,052 $ 959 $ 981 Pizza Hut Division 369 348 341 Taco Bell Division 683 633 619 Corporate and unallocated G&A expenses (b)(g) (188 ) (171 ) (230 ) Unallocated Company restaurant expenses (b)(h) — 3 10 Unallocated Franchise and property revenues (b)(f) — — (5 ) Unallocated Franchise and property expenses (b)(f) (14 ) (8 ) (30 ) Unallocated Refranchising gain (loss) (b) 37 540 1,083 Unallocated Other income (expense) (b) (9 ) (8 ) (8 ) Operating Profit 1,930 2,296 2,761 Investment income (expense), net (b) (67 ) 9 5 Other pension income (expense) (b)(i) (4 ) (14 ) (47 ) Interest expense, net (b) (486 ) (452 ) (445 ) Income before income taxes $ 1,373 $ 1,839 $ 2,274 Depreciation and Amortization 2019 2018 2017 KFC Division $ 30 $ 58 $ 138 Pizza Hut Division 15 10 26 Taco Bell Division 59 61 82 Corporate 8 8 7 $ 112 $ 137 $ 253 Capital Spending 2019 2018 2017 KFC Division $ 81 $ 105 $ 176 Pizza Hut Division 33 38 42 Taco Bell Division 76 85 95 Corporate 6 6 5 $ 196 $ 234 $ 318 Identifiable Assets (d) 2019 2018 KFC Division $ 2,042 $ 1,481 Pizza Hut Division 801 701 Taco Bell Division 1,330 1,074 Corporate (c) 1,058 874 $ 5,231 $ 4,130 Long-Lived Assets (e) 2019 2018 KFC Division $ 1,179 $ 868 Pizza Hut Division 427 384 Taco Bell Division 938 720 Corporate 42 32 $ 2,586 $ 2,004 (a) U.S. revenues included in the combined KFC, Pizza Hut and Taco Bell Divisions totaled $3.0 billion in 2019, $2.9 billion in 2018 and $2.8 billion in 2017. (b) Amounts have not been allocated to any segment for performance reporting purposes. (c) Primarily includes cash, our Grubhub investment and deferred tax assets. (d) U.S. identifiable assets included in the combined Corporate and KFC, Pizza Hut and Taco Bell Divisions totaled $2.7 billion and $2.0 billion in 2019 and 2018, respectively. (e) Includes PP&E, goodwill, intangible assets, net and in 2019, Operating lease right-of-use assets. (f) Represents costs associated with the KFC U.S. Acceleration Agreement and Pizza Hut U.S. Transformation Agreement. See Note 4. (g) Amounts in 2018 include costs related to YUM's Strategic Transformation Initiatives of $8 million , partially offset by non-cash credits associated with modifications of share-based compensation awards of $3 million . Amounts in 2017 include costs related to YUM’s Strategic Transformation Initiatives of $21 million , non-cash charges associated with modifications of share-based compensation awards of $18 million and costs associated with the Pizza Hut U.S. Transformation Agreement of $13 million . See Note 4. (h) Represents depreciation reductions arising primarily from KFC restaurants that were held for sale. See Note 4. (i) Amounts in 2017 include a non-cash charge of $22 million related to the adjustment of certain historical deferred vested liability balances in our qualified U.S. plan. See Note 4. |
Reconciliation of Revenue from Segments to Consolidated | Revenues 2019 2018 2017 KFC Division (a) $ 2,491 $ 2,644 $ 3,110 Pizza Hut Division (a) 1,027 988 893 Taco Bell Division (a) 2,079 2,056 1,880 Unallocated (b)(f) — — (5 ) $ 5,597 $ 5,688 $ 5,878 |
Reconciliation of Operating Profit (Loss) from Segments to Consolidated | Operating Profit 2019 2018 2017 KFC Division $ 1,052 $ 959 $ 981 Pizza Hut Division 369 348 341 Taco Bell Division 683 633 619 Corporate and unallocated G&A expenses (b)(g) (188 ) (171 ) (230 ) Unallocated Company restaurant expenses (b)(h) — 3 10 Unallocated Franchise and property revenues (b)(f) — — (5 ) Unallocated Franchise and property expenses (b)(f) (14 ) (8 ) (30 ) Unallocated Refranchising gain (loss) (b) 37 540 1,083 Unallocated Other income (expense) (b) (9 ) (8 ) (8 ) Operating Profit 1,930 2,296 2,761 Investment income (expense), net (b) (67 ) 9 5 Other pension income (expense) (b)(i) (4 ) (14 ) (47 ) Interest expense, net (b) (486 ) (452 ) (445 ) Income before income taxes $ 1,373 $ 1,839 $ 2,274 |
Reconciliation of Other Significant Reconciling Items from Segments to Consolidated | Depreciation and Amortization 2019 2018 2017 KFC Division $ 30 $ 58 $ 138 Pizza Hut Division 15 10 26 Taco Bell Division 59 61 82 Corporate 8 8 7 $ 112 $ 137 $ 253 Capital Spending 2019 2018 2017 KFC Division $ 81 $ 105 $ 176 Pizza Hut Division 33 38 42 Taco Bell Division 76 85 95 Corporate 6 6 5 $ 196 $ 234 $ 318 Identifiable Assets (d) 2019 2018 KFC Division $ 2,042 $ 1,481 Pizza Hut Division 801 701 Taco Bell Division 1,330 1,074 Corporate (c) 1,058 874 $ 5,231 $ 4,130 Long-Lived Assets (e) 2019 2018 KFC Division $ 1,179 $ 868 Pizza Hut Division 427 384 Taco Bell Division 938 720 Corporate 42 32 $ 2,586 $ 2,004 |
Contingencies (Tables)
Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Activity related to self-insured property and casualty reserves | The following table summarizes the 2019 and 2018 activity related to our net self-insured property and casualty reserves as of December 31, 2019 . Beginning Balance Expense Payments Ending Balance 2019 Activity $ 66 9 (21 ) $ 54 2018 Activity $ 84 11 (29 ) $ 66 |
Selected Quarterly Financial _2
Selected Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Selected Quarterly Financial Information [Abstract] | |
Schedule of Quarterly Financial Information | 2019 First Quarter Second Quarter Third Quarter Fourth Quarter Total Revenues: Company sales $ 333 $ 359 $ 364 $ 490 $ 1,546 Franchise and property revenues 612 633 645 770 2,660 Franchise contributions for advertising and other services 309 318 330 434 1,391 Total revenues 1,254 1,310 1,339 1,694 5,597 Restaurant profit 61 73 72 105 311 Operating Profit (a) 433 471 480 546 1,930 Net Income 262 289 255 488 1,294 Basic earnings per common share 0.85 0.94 0.83 1.61 4.23 Diluted earnings per common share 0.83 0.92 0.81 1.58 4.14 Dividends declared per common share 0.42 0.42 0.42 0.42 1.68 2018 First Quarter Second Quarter Third Quarter Fourth Quarter Total Revenues: Company sales $ 512 $ 512 $ 499 $ 477 $ 2,000 Franchise and property revenues 584 584 605 709 2,482 Franchise contributions for advertising and other services 275 272 287 372 1,206 Total revenues 1,371 1,368 1,391 1,558 5,688 Restaurant profit 74 91 100 101 366 Operating Profit (b) 553 449 553 741 2,296 Net Income 433 321 454 334 1,542 Basic earnings per common share 1.30 0.99 1.43 1.07 4.80 Diluted earnings per common share 1.27 0.97 1.40 1.04 4.69 Dividends declared per common share 0.36 0.36 0.36 0.36 1.44 (a) Includes net gains from refranchising initiatives of $6 million , $4 million , $8 million and $19 million in the first, second, third and fourth quarters, respectively. (b) Includes net gains from refranchising initiatives of $156 million , $29 million , $100 million and $255 million in the first, second, third and fourth quarters, respectively. |
Description of Business (Detail
Description of Business (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||||||||||
Dec. 31, 2019USD ($)restaurantscountries_and_territiories | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2019USD ($)operating_segmentsrestaurantscountries_and_territioriesRate | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||||||
Approximate Number Of System Units | restaurants | 50,000 | 50,000 | |||||||||||||||||||||
Percent Of System Units Located Outside United States | 98.00% | 98.00% | |||||||||||||||||||||
Approximate Number Of Countries And Territories Where System Units Are Located | countries_and_territiories | 150 | 150 | |||||||||||||||||||||
Number of Operating Segments | operating_segments | 3 | ||||||||||||||||||||||
Revenues | $ 1,694 | $ 1,339 | $ 1,310 | $ 1,254 | $ 1,558 | $ 1,391 | $ 1,368 | $ 1,371 | $ 5,597 | $ 5,688 | $ 5,878 | ||||||||||||
Operating Profit | $ 546 | [1] | $ 480 | [1] | $ 471 | [1] | $ 433 | [1] | $ 741 | [2] | $ 553 | [2] | $ 449 | [2] | $ 553 | [2] | 1,930 | [1] | 2,296 | [2] | 2,761 | ||
Stock Repurchased During Period, Value | 810 | [3] | 2,394 | [3] | 1,915 | [4] | |||||||||||||||||
KFC Global Division [Member] | |||||||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||||||
Revenues | [5] | 2,491 | 2,644 | 3,110 | |||||||||||||||||||
Operating Profit | 1,052 | 959 | 981 | ||||||||||||||||||||
Pizza Hut Global Division [Member] | |||||||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||||||
Revenues | [5] | 1,027 | 988 | 893 | |||||||||||||||||||
Operating Profit | 369 | 348 | 341 | ||||||||||||||||||||
Taco Bell Global Division [Member] | |||||||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||||||
Revenues | [5] | 2,079 | 2,056 | 1,880 | |||||||||||||||||||
Operating Profit | $ 683 | $ 633 | $ 619 | ||||||||||||||||||||
Minimum [Member] | |||||||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||||||
Continuing Fees Rate | Rate | 4.00% | ||||||||||||||||||||||
Maximum [Member] | |||||||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||||||
Continuing Fees Rate | Rate | 6.00% | ||||||||||||||||||||||
[1] | Includes net gains from refranchising initiatives of $6 million , $4 million , $8 million and $19 million in the first, second, third and fourth quarters, respectively. | ||||||||||||||||||||||
[2] | Includes net gains from refranchising initiatives of $156 million , $29 million , $100 million and $255 million in the first, second, third and fourth quarters, respectively. | ||||||||||||||||||||||
[3] | 2019 amount excludes and 2018 amount includes the effect of $5 million in share repurchases ( 0.1 million shares) with trade dates on, or prior to, December 31, 2018 but settlement dates subsequent to December 31, 2018. | ||||||||||||||||||||||
[4] | 2017 amount excludes the effect of $45 million in share repurchases ( 0.7 million shares) with trade dates prior to December 31, 2016 but settlement dates subsequent to December 31, 2016. | ||||||||||||||||||||||
[5] | U.S. revenues included in the combined KFC, Pizza Hut and Taco Bell Divisions totaled $3.0 billion in 2019, $2.9 billion in 2018 and $2.8 billion in 2017. |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | 18 Months Ended | ||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | ||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Net Income (loss) - YUM! Brands, Inc. | $ 334 | $ 454 | $ 321 | $ 433 | $ 1,294 | $ 1,542 | $ 1,340 | ||||||
Business Combination, Consideration Transferred | 375 | 77 | |||||||||||
Payments to Acquire Businesses, Net of Cash Acquired | 0 | 66 | 0 | ||||||||||
Advertising Expense | 73 | 96 | 179 | ||||||||||
Costs associated with PH U.S. Acceleration Agreement | 25 | 25 | 39 | ||||||||||
Cooperative Advertising Expense | 1,368 | 1,208 | 0 | ||||||||||
Rental income | 86 | ||||||||||||
Future lease payments due from franchisees on a nominal basis | $ 1,000 | 1,000 | |||||||||||
Reclassification of Retained Earnings to Common Stock for Share Repurchase | 796 | 2,356 | 1,915 | ||||||||||
Revenues | 1,694 | $ 1,339 | $ 1,310 | $ 1,254 | 1,558 | 1,391 | 1,368 | 1,371 | 5,597 | 5,688 | 5,878 | ||
Retained Earnings | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Net Income (loss) - YUM! Brands, Inc. | 1,294 | 1,542 | 1,340 | ||||||||||
Employee stock option and SARs exercises (includes tax impact) | 18 | 20 | |||||||||||
Advertising Cooperatives [Domain] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Advertising Expense | 10 | 35 | 66 | ||||||||||
Cooperative Advertising Expense | 1,133 | 1,035 | |||||||||||
Product [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 490 | 364 | 359 | 333 | 477 | 499 | 512 | 512 | 1,546 | 2,000 | 3,572 | ||
Advertising [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 434 | $ 330 | $ 318 | $ 309 | $ 372 | $ 287 | $ 272 | $ 275 | 1,391 | 1,206 | 0 | ||
United States | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Rental income | 70 | 54 | |||||||||||
United States | Product [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 1,014 | 1,143 | |||||||||||
United States | Franchise [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 1,059 | 994 | |||||||||||
United States | Advertising [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 811 | 706 | |||||||||||
CHINA | Franchise [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 274 | 260 | |||||||||||
Other, Outside the U.S. and China [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Rental income | 72 | 77 | |||||||||||
Other, Outside the U.S. and China [Member] | Product [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 532 | 857 | |||||||||||
Other, Outside the U.S. and China [Member] | Franchise [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 1,185 | 1,097 | |||||||||||
Other, Outside the U.S. and China [Member] | Advertising [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 580 | 500 | |||||||||||
KFC Global Division [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenues | [1] | 2,491 | 2,644 | 3,110 | |||||||||
KFC Global Division [Member] | United States | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Rental income | 20 | 23 | |||||||||||
KFC Global Division [Member] | United States | Product [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 74 | 72 | |||||||||||
KFC Global Division [Member] | United States | Franchise [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 175 | 171 | |||||||||||
KFC Global Division [Member] | United States | Advertising [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 10 | 9 | |||||||||||
KFC Global Division [Member] | CHINA | Franchise [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 214 | 201 | |||||||||||
KFC Global Division [Member] | Other, Outside the U.S. and China [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Rental income | 69 | 74 | |||||||||||
KFC Global Division [Member] | Other, Outside the U.S. and China [Member] | Product [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 497 | 822 | |||||||||||
KFC Global Division [Member] | Other, Outside the U.S. and China [Member] | Franchise [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 912 | 825 | |||||||||||
KFC Global Division [Member] | Other, Outside the U.S. and China [Member] | Advertising [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 520 | 447 | |||||||||||
Pizza Hut Global Division [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenues | [1] | 1,027 | 988 | 893 | |||||||||
Pizza Hut Global Division [Member] | United States | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Rental income | 6 | 4 | |||||||||||
Pizza Hut Global Division [Member] | United States | Product [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 21 | 37 | |||||||||||
Pizza Hut Global Division [Member] | United States | Franchise [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 282 | 284 | |||||||||||
Pizza Hut Global Division [Member] | United States | Advertising [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 318 | 269 | |||||||||||
Pizza Hut Global Division [Member] | CHINA | Franchise [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 60 | 59 | |||||||||||
Pizza Hut Global Division [Member] | Other, Outside the U.S. and China [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Rental income | 3 | 3 | |||||||||||
Pizza Hut Global Division [Member] | Other, Outside the U.S. and China [Member] | Product [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 33 | 32 | |||||||||||
Pizza Hut Global Division [Member] | Other, Outside the U.S. and China [Member] | Franchise [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 246 | 248 | |||||||||||
Pizza Hut Global Division [Member] | Other, Outside the U.S. and China [Member] | Advertising [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 58 | 52 | |||||||||||
Taco Bell Global Division [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenues | [1] | 2,079 | 2,056 | 1,880 | |||||||||
Taco Bell Global Division [Member] | United States | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Rental income | 44 | 27 | |||||||||||
Taco Bell Global Division [Member] | United States | Product [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 919 | 1,034 | |||||||||||
Taco Bell Global Division [Member] | United States | Franchise [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 602 | 539 | |||||||||||
Taco Bell Global Division [Member] | United States | Advertising [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 483 | 428 | |||||||||||
Taco Bell Global Division [Member] | CHINA | Franchise [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | |||||||||||
Taco Bell Global Division [Member] | Other, Outside the U.S. and China [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Rental income | 0 | 0 | |||||||||||
Taco Bell Global Division [Member] | Other, Outside the U.S. and China [Member] | Product [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 2 | 3 | |||||||||||
Taco Bell Global Division [Member] | Other, Outside the U.S. and China [Member] | Franchise [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 27 | 24 | |||||||||||
Taco Bell Global Division [Member] | Other, Outside the U.S. and China [Member] | Advertising [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 2 | 1 | |||||||||||
Franchise and property expenses [Member] | Pizza Hut Global Division [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Costs associated with PH U.S. Acceleration Agreement | 12.5 | 25 | $ 37.5 | ||||||||||
1 year [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Deferred Revenue, Revenue Expected to be Recognized | 65 | 65 | |||||||||||
2 years [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Deferred Revenue, Revenue Expected to be Recognized | 60 | 60 | |||||||||||
3 years [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Deferred Revenue, Revenue Expected to be Recognized | 56 | 56 | |||||||||||
4 years [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Deferred Revenue, Revenue Expected to be Recognized | 51 | 51 | |||||||||||
5 years [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Deferred Revenue, Revenue Expected to be Recognized | 46 | 46 | |||||||||||
Thereafter 5 years [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Deferred Revenue, Revenue Expected to be Recognized | $ 163 | 163 | |||||||||||
Incremental Advertising [Member] | KFC Global Division [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Costs associated with KFC U.S. Acceleration Agreement | 10 | 20 | |||||||||||
Incremental Advertising [Member] | Franchise and property expenses [Member] | KFC Global Division [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Costs associated with KFC U.S. Acceleration Agreement | 10 | 20 | |||||||||||
Incremental Advertising [Member] | Franchise and property expenses [Member] | Pizza Hut Global Division [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Costs associated with PH U.S. Acceleration Agreement | $ 12.5 | $ 25 | |||||||||||
53rd Week Impact [Member] | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Net Income (loss) - YUM! Brands, Inc. | 17 | ||||||||||||
Revenues | $ 66 | ||||||||||||
[1] | U.S. revenues included in the combined KFC, Pizza Hut and Taco Bell Divisions totaled $3.0 billion in 2019, $2.9 billion in 2018 and $2.8 billion in 2017. |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details 2) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2019USD ($)Years | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |||||||||||
Fiscal Period Adjustment [Line Items] | |||||||||||||||||||||
Goodwill Written Off Related To Sale Of Business Unit Years From Acquisition | Years | 2 | ||||||||||||||||||||
Revenues | $ | $ 1,694 | $ 1,339 | $ 1,310 | $ 1,254 | $ 1,558 | $ 1,391 | $ 1,368 | $ 1,371 | $ 5,597 | $ 5,688 | $ 5,878 | ||||||||||
Restaurant Profit | $ | 105 | 72 | 73 | 61 | 101 | 100 | 91 | 74 | 311 | 366 | |||||||||||
Operating Profit | $ | $ 546 | [1] | $ 480 | [1] | $ 471 | [1] | $ 433 | [1] | $ 741 | [2] | $ 553 | [2] | $ 449 | [2] | $ 553 | [2] | $ 1,930 | [1] | $ 2,296 | [2] | $ 2,761 |
Fair Value Goodwill Written Off Related To Sale Of Business Unit Minimum Years Refranchised | Years | 2 | ||||||||||||||||||||
Number of years notes receivable and direct financing leases are beyond and would be included in other assets | Years | 1 | ||||||||||||||||||||
Number of years notes receivable and direct financing leases are due within and would be included in accounts and notes receivable | Years | 1 | ||||||||||||||||||||
Number Of Consecutive Years Used As Primary Indicator Of Potential Impairment Of Restaurant Assets | Years | 2 | ||||||||||||||||||||
53rd Week Impact [Member] | |||||||||||||||||||||
Fiscal Period Adjustment [Line Items] | |||||||||||||||||||||
Revenues | $ | $ 66 | ||||||||||||||||||||
Operating Profit | $ | $ 24 | ||||||||||||||||||||
[1] | Includes net gains from refranchising initiatives of $6 million , $4 million , $8 million and $19 million in the first, second, third and fourth quarters, respectively. | ||||||||||||||||||||
[2] | Includes net gains from refranchising initiatives of $156 million , $29 million , $100 million and $255 million in the first, second, third and fourth quarters, respectively. |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Details 3) $ in Millions | 12 Months Ended | 18 Months Ended | ||
Dec. 31, 2019USD ($)Years | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2018USD ($) | |
Property, Plant and Equipment [Line Items] | ||||
Deferred Tax Assets, Net of Valuation Allowance, Current | $ 447 | $ 195 | $ 195 | |
Foreign Currency [Abstract] | ||||
Foreign currency translation adjustment | 221 | |||
Direct Marketing Costs [Abstract] | ||||
Advertising Expense | $ 73 | 96 | $ 179 | |
Impairment or Disposal of Property, Plant and Equipment [Abstract] | ||||
Number of consecutive years of operating losses used as primary indicator of potential impairment for our semi-annual impairment testing of restaurant assets | Years | 2 | |||
Goodwill and Intangible Assets [Abstract] | ||||
Goodwill Written Off Related To Sale Of Business Unit Years From Acquisition | Years | 2 | |||
Fair Value Goodwill Written Off Related To Sale Of Business Unit Minimum Years Refranchised | Years | 2 | |||
Costs associated with PH U.S. Acceleration Agreement | $ 25 | 25 | 39 | |
Minimum [Member] | Buildings and improvements | ||||
Property, Plant and Equipment [Line Items] | ||||
Estimated useful life used in the calculation of the depreciation and amortization on a straight-line basis (in years) | 5 years | |||
Minimum [Member] | Machinery and equipment | ||||
Property, Plant and Equipment [Line Items] | ||||
Estimated useful life used in the calculation of the depreciation and amortization on a straight-line basis (in years) | 3 years | |||
Maximum [Member] | Buildings and improvements | ||||
Property, Plant and Equipment [Line Items] | ||||
Estimated useful life used in the calculation of the depreciation and amortization on a straight-line basis (in years) | 25 years | |||
Maximum [Member] | Machinery and equipment | ||||
Property, Plant and Equipment [Line Items] | ||||
Estimated useful life used in the calculation of the depreciation and amortization on a straight-line basis (in years) | 20 years | |||
Pizza Hut Global Division [Member] | Franchise and property expenses [Member] | ||||
Goodwill and Intangible Assets [Abstract] | ||||
Costs associated with PH U.S. Acceleration Agreement | $ 12.5 | $ 25 | $ 37.5 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies (Details 4) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | 18 Months Ended | ||||||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Jan. 01, 2018 | |||||
Reclassification of Retained Earnings to Common Stock for Share Repurchase | $ 796 | $ 2,356 | $ 1,915 | ||||||||||||||
Costs associated with PH U.S. Acceleration Agreement | 25 | 25 | 39 | ||||||||||||||
Revenues | $ 1,694 | $ 1,339 | $ 1,310 | $ 1,254 | $ 1,558 | $ 1,391 | $ 1,368 | $ 1,371 | $ 5,597 | 5,688 | 5,878 | ||||||
Period Within Date Of Corresponding Sales In Which Trade Receivables Are Classified As Accounts And Notes Receivable | 30 days | ||||||||||||||||
Receivables [Abstract] | |||||||||||||||||
Net amounts included in Other Assets | 68 | 62 | $ 68 | 62 | $ 62 | ||||||||||||
Allowance for doubtful accounts related to notes and direct financing lease receivables | 1 | 1 | 1 | 1 | 1 | ||||||||||||
Accounts and notes receivable [Abstract] | |||||||||||||||||
Accounts and notes receivable | 656 | 592 | 656 | 592 | 592 | ||||||||||||
Allowance for doubtful accounts | (72) | (31) | (72) | (31) | (31) | ||||||||||||
Accounts and notes receivable, net | 584 | 561 | 584 | 561 | 561 | ||||||||||||
Other Assets | 431 | 321 | 431 | 321 | 321 | ||||||||||||
Deferred income taxes | 447 | 195 | 447 | 195 | 195 | ||||||||||||
Other current liabilities | 349 | 347 | 349 | 347 | 347 | ||||||||||||
Repurchase Of Shares Of Common Stock [Abstract] | |||||||||||||||||
Stock Repurchased During Period, Value | (810) | [1] | (2,394) | [1] | (1,915) | [2] | |||||||||||
Net Cash Provided by (Used in) Operating Activities | 1,315 | 1,176 | 1,030 | ||||||||||||||
Cash, Cash Equivalents and Restricted Cash as presented in the Consolidated Statement of Cash Flows | [3] | $ 768 | $ 474 | 768 | 474 | 1,599 | 474 | ||||||||||
Operating Expenses | 3,667 | 3,392 | 3,117 | ||||||||||||||
Reduction to Retained earnings | |||||||||||||||||
Employee stock option and SARs exercises (includes tax impact) | 18 | 20 | |||||||||||||||
Repurchase Of Shares Of Common Stock [Abstract] | |||||||||||||||||
Stock Repurchased During Period, Value | (796) | (2,356) | (1,915) | ||||||||||||||
Accounting Standards Update 2014-09 [Member] | |||||||||||||||||
Accounts and notes receivable [Abstract] | |||||||||||||||||
Deferred income taxes | $ 26 | ||||||||||||||||
Franchise and property expenses [Member] | |||||||||||||||||
Repurchase Of Shares Of Common Stock [Abstract] | |||||||||||||||||
Sales Allowances, Services | 24 | 11 | 5 | ||||||||||||||
Franchise advertising and other services expenses [Member] [Member] | |||||||||||||||||
Repurchase Of Shares Of Common Stock [Abstract] | |||||||||||||||||
Sales Allowances, Services | $ 19 | ||||||||||||||||
Minimum [Member] | |||||||||||||||||
Continuing Fees Rate | 4.00% | ||||||||||||||||
Maximum [Member] | |||||||||||||||||
Continuing Fees Rate | 6.00% | ||||||||||||||||
Advertising [Member] | |||||||||||||||||
Repurchase Of Shares Of Common Stock [Abstract] | |||||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 1,100 | ||||||||||||||||
Capitalized software costs | Minimum [Member] | |||||||||||||||||
Finite-Lived Intangible Asset, Useful Life | 3 years | ||||||||||||||||
Capitalized software costs | Maximum [Member] | |||||||||||||||||
Finite-Lived Intangible Asset, Useful Life | 7 years | ||||||||||||||||
Pizza Hut Global Division [Member] | |||||||||||||||||
Revenues | [4] | $ 1,027 | 988 | 893 | |||||||||||||
Pizza Hut Global Division [Member] | Franchise and property expenses [Member] | |||||||||||||||||
Costs associated with PH U.S. Acceleration Agreement | 12.5 | 25 | $ 37.5 | ||||||||||||||
Pizza Hut Global Division [Member] | Incremental Advertising [Member] | Franchise and property expenses [Member] | |||||||||||||||||
Costs associated with PH U.S. Acceleration Agreement | $ 12.5 | $ 25 | |||||||||||||||
[1] | 2019 amount excludes and 2018 amount includes the effect of $5 million in share repurchases ( 0.1 million shares) with trade dates on, or prior to, December 31, 2018 but settlement dates subsequent to December 31, 2018. | ||||||||||||||||
[2] | 2017 amount excludes the effect of $45 million in share repurchases ( 0.7 million shares) with trade dates prior to December 31, 2016 but settlement dates subsequent to December 31, 2016. | ||||||||||||||||
[3] | Upon adoption of Topic 606 we reclassified cash of $11 million and restricted cash of $58 million , respectively, from Advertising cooperative assets, restricted to Cash and cash equivalents and Prepaid expenses and other current assets. These amounts are included in the Beginning of Year balance of Cash, Cash Equivalents, Restricted Cash and Restricted Cash equivalents in our Consolidated Statement of Cash Flows for the year ended December 31, 2018. | ||||||||||||||||
[4] | U.S. revenues included in the combined KFC, Pizza Hut and Taco Bell Divisions totaled $3.0 billion in 2019, $2.9 billion in 2018 and $2.8 billion in 2017. |
Note 2. Summary of Significan_2
Note 2. Summary of Significant Accounting Policies Summary of Significant Accounting Policies (Details 5) - USD ($) $ in Millions | 12 Months Ended | 18 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | |
Costs associated with PH U.S. Acceleration Agreement | $ 25 | $ 25 | $ 39 | |
Advertising Expense | 73 | 96 | 179 | |
Cooperative Advertising Expense | 1,368 | 1,208 | 0 | |
Franchise and property expenses [Member] | Pizza Hut Global Division [Member] | ||||
Costs associated with PH U.S. Acceleration Agreement | 12.5 | 25 | $ 37.5 | |
Franchise and property expenses [Member] | Pizza Hut Global Division [Member] | Incremental Advertising [Member] | ||||
Costs associated with PH U.S. Acceleration Agreement | 12.5 | 25 | ||
Incremental Advertising [Member] | KFC Global Division [Member] | ||||
Costs associated with KFC U.S. Acceleration Agreement | 10 | 20 | ||
Incremental Advertising [Member] | Franchise and property expenses [Member] | KFC Global Division [Member] | ||||
Costs associated with KFC U.S. Acceleration Agreement | 10 | 20 | ||
Advertising Cooperatives [Domain] | ||||
Advertising Expense | 10 | 35 | $ 66 | |
Cooperative Advertising Expense | $ 1,133 | $ 1,035 |
Earnings Per Common Share ("E_3
Earnings Per Common Share ("EPS") (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Income from continuing operations | $ 488 | $ 255 | $ 289 | $ 262 | $ 1,294 | |||||||
Net Income | $ 334 | $ 454 | $ 321 | $ 433 | $ 1,294 | $ 1,542 | $ 1,340 | |||||
Weighted-average common shares outstanding (for basic calculation) (in shares) | 306 | 322 | 347 | |||||||||
Effect of dilutive share-based employee compensation (in shares) | 7 | 7 | 8 | |||||||||
Weighted-average common and dilutive potential common shares outstanding (for diluted calculation) (in shares) | 313 | 329 | 355 | |||||||||
Basic EPS (in dollars per share) | $ 1.61 | $ 0.83 | $ 0.94 | $ 0.85 | $ 1.07 | $ 1.43 | $ 0.99 | $ 1.30 | $ 4.23 | $ 4.80 | $ 3.86 | |
Diluted EPS (in dollars per share) | $ 1.58 | $ 0.81 | $ 0.92 | $ 0.83 | $ 1.04 | $ 1.40 | $ 0.97 | $ 1.27 | $ 4.14 | $ 4.69 | $ 3.77 | |
Unexercised employee stock options and stock appreciation rights (in millions) excluded from the diluted EPS computation (in shares) | [1] | 2 | 2 | 2.3 | ||||||||
[1] | These unexercised employee stock options and stock appreciation rights were not included in the computation of diluted EPS because to do so would have been antidilutive for the periods presented. |
Items Affecting Comparability_3
Items Affecting Comparability of Net Income and Cash Flows (Details) $ / shares in Units, shares in Millions | 3 Months Ended | 12 Months Ended | 18 Months Ended | 32 Months Ended | 48 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2019USD ($)$ / shares | Sep. 30, 2019USD ($)$ / shares | Jun. 30, 2019USD ($)$ / shares | Mar. 31, 2019USD ($)$ / shares | Dec. 31, 2018USD ($)$ / shares | Sep. 30, 2018USD ($)$ / shares | Jun. 30, 2018USD ($)$ / sharesshares | Mar. 31, 2018USD ($)$ / shares | Dec. 31, 2019USD ($)restaurants$ / shares | Dec. 31, 2018USD ($)restaurants$ / shares | Dec. 31, 2017USD ($)restaurants$ / shares | Dec. 31, 2018USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Jan. 01, 2019USD ($) | Jan. 01, 2018USD ($) | Dec. 31, 2016USD ($) | |||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Business Combination, Consideration Transferred | $ 375,000,000 | $ 77,000,000 | |||||||||||||||||||||||||||
Payments to Acquire Businesses, Net of Cash Acquired | $ 0 | 66,000,000 | $ 0 | ||||||||||||||||||||||||||
Business Combination, Consideration Transferred, Other | $ 6,000,000 | 6,000,000 | $ 6,000,000 | $ 6,000,000 | |||||||||||||||||||||||||
Business Combination, Contingent Consideration, Liability | 5,000,000 | 5,000,000 | 5,000,000 | 5,000,000 | |||||||||||||||||||||||||
Impact of adopting Topic 606 on our Condensed Consolidated Statements of Income [Table Text Block] | The following tables reflect the impact of the adoption of Topic 606 on our Consolidated Statement of Income for the year ended December 31, 2018 and our Consolidated Balance Sheet as of December 31, 2018. CONSOLIDATED STATEMENT OF INCOME Year ended 12/31/2018 Revenues As Reported Impact Balances under Legacy Revenue GAAP Company sales $ 2,000 $ — $ 2,000 Franchise and property revenues 2,482 43 2,525 Franchise contributions for advertising and other services 1,206 (1,206 ) — Total revenues 5,688 (1,163 ) 4,525 Costs and Expenses, Net Company restaurant expenses 1,634 — 1,634 General and administrative expenses 895 — 895 Franchise and property expenses 188 27 215 Franchise advertising and other services expense 1,208 (1,208 ) — Refranchising (gain) loss (540 ) 4 (536 ) Other (income) expense 7 — 7 Total costs and expenses, net 3,392 (1,177 ) 2,215 Operating Profit 2,296 14 (a) 2,310 Investment (income) expense, net (9 ) — (9 ) Other pension (income) expense 14 — 14 Interest expense, net 452 — 452 Income before income taxes 1,839 14 1,853 Income tax provision (benefit) 297 3 300 Net Income $ 1,542 $ 11 $ 1,553 Basic Earnings Per Common Share $ 4.80 $ 0.03 $ 4.83 Diluted Earnings Per Common Share $ 4.69 $ 0.03 $ 4.72 (a) Includes $23 million of franchise incentive payments made to or on behalf of franchisees during 2018 that under Legacy Revenue GAAP would have been recognized as expense in full in 2018. Due to the size and nature of such payments, we historically would not have allocated their impact to our Divisional results. Upon the adoption of Topic 606, these payments have been capitalized as assets. | ||||||||||||||||||||||||||||
Cash and cash equivalents | $ 605,000,000 | 292,000,000 | $ 605,000,000 | 292,000,000 | 1,522,000,000 | 292,000,000 | $ 605,000,000 | 292,000,000 | |||||||||||||||||||||
Net Cash Provided by (Used in) Operating Activities | 1,315,000,000 | 1,176,000,000 | 1,030,000,000 | ||||||||||||||||||||||||||
Revenues | 1,694,000,000 | $ 1,339,000,000 | $ 1,310,000,000 | $ 1,254,000,000 | 1,558,000,000 | $ 1,391,000,000 | $ 1,368,000,000 | $ 1,371,000,000 | 5,597,000,000 | 5,688,000,000 | 5,878,000,000 | ||||||||||||||||||
Proceeds from refranchising of restaurants | 110,000,000 | 825,000,000 | 1,773,000,000 | ||||||||||||||||||||||||||
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Amount | (35,000,000) | (434,000,000) | |||||||||||||||||||||||||||
Facility Actions [Abstract] | |||||||||||||||||||||||||||||
Closure and impairment (income) expenses | 5,000,000 | 6,000,000 | 3,000,000 | ||||||||||||||||||||||||||
Carrying value of goodwill | 39,000,000 | 39,000,000 | 39,000,000 | 39,000,000 | |||||||||||||||||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 33,000,000 | 33,000,000 | 33,000,000 | 33,000,000 | |||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Reclassification Adjustment from AOCI, Realized upon Sale or Liquidation, before Tax | 0 | 4,000,000 | (55,000,000) | ||||||||||||||||||||||||||
General and administrative expenses | 917,000,000 | 895,000,000 | 999,000,000 | ||||||||||||||||||||||||||
Costs associated with PH U.S. Acceleration Agreement | 25,000,000 | 25,000,000 | 39,000,000 | ||||||||||||||||||||||||||
Operating Profit | 546,000,000 | [1] | 480,000,000 | [1] | 471,000,000 | [1] | 433,000,000 | [1] | 741,000,000 | [2] | 553,000,000 | [2] | 449,000,000 | [2] | 553,000,000 | [2] | 1,930,000,000 | [1] | 2,296,000,000 | [2] | 2,761,000,000 | ||||||||
Investment Income, Net | [3] | (67,000,000) | 9,000,000 | 5,000,000 | |||||||||||||||||||||||||
Income from continuing operations | $ 488,000,000 | $ 255,000,000 | $ 289,000,000 | $ 262,000,000 | 1,294,000,000 | ||||||||||||||||||||||||
Net Income (Loss) Attributable to Parent | $ 334,000,000 | $ 454,000,000 | $ 321,000,000 | $ 433,000,000 | $ 1,294,000,000 | $ 1,542,000,000 | $ 1,340,000,000 | ||||||||||||||||||||||
Diluted EPS (in dollars per share) | $ / shares | $ 1.58 | $ 0.81 | $ 0.92 | $ 0.83 | $ 1.04 | $ 1.40 | $ 0.97 | $ 1.27 | $ 4.14 | $ 4.69 | $ 3.77 | ||||||||||||||||||
Net Cash Provided by (Used in) Investing Activities | $ (88,000,000) | $ 313,000,000 | $ 1,472,000,000 | ||||||||||||||||||||||||||
Net Cash Used in Financing Activities | (938,000,000) | (2,620,000,000) | (1,795,000,000) | ||||||||||||||||||||||||||
Total Shareholders' Equity | $ (8,016,000,000) | $ (7,926,000,000) | (8,016,000,000) | (7,926,000,000) | (7,926,000,000) | (8,016,000,000) | (7,926,000,000) | ||||||||||||||||||||||
Deferred Income Tax Expense (Benefit) | 232,000,000 | 11,000,000 | (634,000,000) | ||||||||||||||||||||||||||
Accounts and notes receivable, net | 584,000,000 | 561,000,000 | 584,000,000 | 561,000,000 | 561,000,000 | 584,000,000 | 561,000,000 | ||||||||||||||||||||||
Prepaid Expense and Other Assets, Current | 338,000,000 | 354,000,000 | 338,000,000 | 354,000,000 | 354,000,000 | 338,000,000 | 354,000,000 | ||||||||||||||||||||||
Assets, Current | 1,527,000,000 | 1,207,000,000 | 1,527,000,000 | 1,207,000,000 | 1,207,000,000 | 1,527,000,000 | 1,207,000,000 | ||||||||||||||||||||||
Property, Plant and equipment, net | 1,170,000,000 | 1,237,000,000 | 1,170,000,000 | 1,237,000,000 | 1,237,000,000 | 1,170,000,000 | 1,237,000,000 | ||||||||||||||||||||||
Goodwill | [4] | 530,000,000 | 525,000,000 | 530,000,000 | 525,000,000 | 512,000,000 | 525,000,000 | 530,000,000 | 525,000,000 | ||||||||||||||||||||
Intangible assets, net | 244,000,000 | 242,000,000 | 244,000,000 | 242,000,000 | 242,000,000 | 244,000,000 | 242,000,000 | ||||||||||||||||||||||
Other assets | (1,313,000,000) | (724,000,000) | (1,313,000,000) | (724,000,000) | (724,000,000) | (1,313,000,000) | (724,000,000) | ||||||||||||||||||||||
Deferred income taxes | 447,000,000 | 195,000,000 | 447,000,000 | 195,000,000 | 195,000,000 | 447,000,000 | 195,000,000 | ||||||||||||||||||||||
Total Assets | [5] | 5,231,000,000 | 4,130,000,000 | 5,231,000,000 | 4,130,000,000 | 4,130,000,000 | 5,231,000,000 | 4,130,000,000 | |||||||||||||||||||||
Accounts payable and other current liabilities | 960,000,000 | 911,000,000 | 960,000,000 | 911,000,000 | 911,000,000 | 960,000,000 | 911,000,000 | ||||||||||||||||||||||
Income taxes payable | 150,000,000 | 69,000,000 | 150,000,000 | 69,000,000 | 69,000,000 | 150,000,000 | 69,000,000 | ||||||||||||||||||||||
Short-term borrowings | 431,000,000 | 321,000,000 | 431,000,000 | 321,000,000 | 321,000,000 | 431,000,000 | 321,000,000 | ||||||||||||||||||||||
Liabilities, Current | 1,541,000,000 | 1,301,000,000 | 1,541,000,000 | 1,301,000,000 | 1,301,000,000 | 1,541,000,000 | 1,301,000,000 | ||||||||||||||||||||||
Long-term debt | 10,131,000,000 | 9,751,000,000 | 10,131,000,000 | 9,751,000,000 | 9,751,000,000 | 10,131,000,000 | 9,751,000,000 | ||||||||||||||||||||||
Total Liabilities | 13,247,000,000 | 12,056,000,000 | 13,247,000,000 | 12,056,000,000 | 12,056,000,000 | 13,247,000,000 | 12,056,000,000 | ||||||||||||||||||||||
Retained Earnings (Accumulated Deficit) | (7,628,000,000) | (7,592,000,000) | (7,628,000,000) | (7,592,000,000) | (7,592,000,000) | (7,628,000,000) | (7,592,000,000) | ||||||||||||||||||||||
Accumulated other comprehensive income (loss) | (388,000,000) | (334,000,000) | (388,000,000) | (334,000,000) | (334,000,000) | (388,000,000) | (334,000,000) | ||||||||||||||||||||||
Total Liabilities, Redeemable Noncontrolling Interest and Shareholders' Equity | 5,231,000,000 | 4,130,000,000 | 5,231,000,000 | 4,130,000,000 | 4,130,000,000 | 5,231,000,000 | 4,130,000,000 | ||||||||||||||||||||||
Cost of Goods and Services Sold | 1,235,000,000 | 1,634,000,000 | 2,954,000,000 | ||||||||||||||||||||||||||
Franchisor Costs | 180,000,000 | 188,000,000 | 237,000,000 | ||||||||||||||||||||||||||
Cooperative Advertising Expense | 1,368,000,000 | 1,208,000,000 | 0 | ||||||||||||||||||||||||||
Gain (Loss) on Disposition of Assets | $ 19,000,000 | $ 8,000,000 | $ 4,000,000 | $ 6,000,000 | $ 255,000,000 | $ 100,000,000 | $ 29,000,000 | $ 156,000,000 | 37,000,000 | 540,000,000 | 1,083,000,000 | ||||||||||||||||||
Other Operating Income (Expense), Net | (4,000,000) | (7,000,000) | (10,000,000) | ||||||||||||||||||||||||||
Operating Expenses | 3,667,000,000 | 3,392,000,000 | 3,117,000,000 | ||||||||||||||||||||||||||
Other Pension (income) expense | [3],[6] | 4,000,000 | 14,000,000 | 47,000,000 | |||||||||||||||||||||||||
Interest Income (Expense), Net | [3] | (486,000,000) | (452,000,000) | (445,000,000) | |||||||||||||||||||||||||
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | 1,373,000,000 | 1,839,000,000 | 2,274,000,000 | ||||||||||||||||||||||||||
Income tax provision | $ 79,000,000 | $ 297,000,000 | $ 934,000,000 | ||||||||||||||||||||||||||
Basic Earnings Per Common Share (in dollars per share) | $ / shares | $ 1.61 | $ 0.83 | $ 0.94 | $ 0.85 | $ 1.07 | $ 1.43 | $ 0.99 | $ 1.30 | $ 4.23 | $ 4.80 | $ 3.86 | ||||||||||||||||||
Interest Expense [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Liability | $ 2,000,000 | ||||||||||||||||||||||||||||
Gain (loss) on disposition of assets [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Number of Restaurants Refranchised | restaurants | 25 | 660 | 1,470 | ||||||||||||||||||||||||||
Other Income and Expenses [Domain] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Liability | $ 8,000,000 | ||||||||||||||||||||||||||||
Corporate and Other [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Revenues | [3],[7] | 0 | $ 0 | $ (5,000,000) | |||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
General and administrative expenses | [3],[8] | (188,000,000) | (171,000,000) | (230,000,000) | |||||||||||||||||||||||||
Total Assets | [5],[9] | $ 1,058,000,000 | $ 874,000,000 | 1,058,000,000 | 874,000,000 | 874,000,000 | 1,058,000,000 | 874,000,000 | |||||||||||||||||||||
Cost of Goods and Services Sold | [3],[10] | 0 | 3,000,000 | 10,000,000 | |||||||||||||||||||||||||
Corporate and Other [Member] | General and Administrative Expense [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Restructuring and Related Cost, Incurred Cost | 8,000,000 | 23,000,000 | |||||||||||||||||||||||||||
Costs associated with PH U.S. Acceleration Agreement | 13,000,000 | ||||||||||||||||||||||||||||
Corporate and Other [Member] | Franchise and property expenses [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Costs associated with PH U.S. Acceleration Agreement | 13,000,000 | 6,000,000 | 31,000,000 | 89,000,000 | |||||||||||||||||||||||||
KFC Global Division [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Revenues | [11] | 2,491,000,000 | 2,644,000,000 | 3,110,000,000 | |||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Operating Profit | 1,052,000,000 | 959,000,000 | 981,000,000 | ||||||||||||||||||||||||||
Goodwill | [4] | 233,000,000 | 230,000,000 | 233,000,000 | 230,000,000 | 247,000,000 | 230,000,000 | 233,000,000 | 230,000,000 | ||||||||||||||||||||
Total Assets | [5] | 2,042,000,000 | 1,481,000,000 | 2,042,000,000 | 1,481,000,000 | 1,481,000,000 | 2,042,000,000 | 1,481,000,000 | |||||||||||||||||||||
Gain (Loss) on Disposition of Assets | 6,000,000 | 240,000,000 | 581,000,000 | ||||||||||||||||||||||||||
U.S. | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Revenues | 3,000,000,000 | 2,900,000,000 | 2,800,000,000 | ||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Total Assets | 2,700,000,000 | 2,000,000,000 | 2,700,000,000 | 2,000,000,000 | 2,000,000,000 | 2,700,000,000 | 2,000,000,000 | ||||||||||||||||||||||
Pizza Hut Global Division [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Revenues | [11] | 1,027,000,000 | 988,000,000 | 893,000,000 | |||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Operating Profit | 369,000,000 | 348,000,000 | 341,000,000 | ||||||||||||||||||||||||||
Goodwill | [4] | 199,000,000 | 196,000,000 | 199,000,000 | 196,000,000 | 162,000,000 | 196,000,000 | 199,000,000 | 196,000,000 | ||||||||||||||||||||
Total Assets | [5] | 801,000,000 | 701,000,000 | 801,000,000 | 701,000,000 | 701,000,000 | 801,000,000 | 701,000,000 | |||||||||||||||||||||
Gain (Loss) on Disposition of Assets | 0 | (13,000,000) | 16,000,000 | ||||||||||||||||||||||||||
Pizza Hut Global Division [Member] | Franchise and property expenses [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Costs associated with PH U.S. Acceleration Agreement | 12,500,000 | 25,000,000 | 37,500,000 | ||||||||||||||||||||||||||
Taco Bell Global Division [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Revenues | [11] | 2,079,000,000 | 2,056,000,000 | 1,880,000,000 | |||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Operating Profit | 683,000,000 | 633,000,000 | 619,000,000 | ||||||||||||||||||||||||||
Goodwill | [4] | 98,000,000 | 99,000,000 | 98,000,000 | 99,000,000 | 103,000,000 | 99,000,000 | 98,000,000 | 99,000,000 | ||||||||||||||||||||
Total Assets | [5] | 1,330,000,000 | 1,074,000,000 | 1,330,000,000 | 1,074,000,000 | 1,074,000,000 | 1,330,000,000 | 1,074,000,000 | |||||||||||||||||||||
Gain (Loss) on Disposition of Assets | 31,000,000 | 313,000,000 | 486,000,000 | ||||||||||||||||||||||||||
Retained Earnings | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Net Income (Loss) Attributable to Parent | 1,294,000,000 | 1,542,000,000 | 1,340,000,000 | ||||||||||||||||||||||||||
Total Shareholders' Equity | (7,628,000,000) | (7,592,000,000) | (7,628,000,000) | (7,592,000,000) | (6,063,000,000) | (7,592,000,000) | (7,628,000,000) | (7,592,000,000) | $ (5,157,000,000) | ||||||||||||||||||||
2017 to 2020 [Domain] | Unallocated and General and administrative expenses [Domain] | Franchise and property expenses [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Costs associated with PH U.S. Acceleration Agreement | 90,000,000 | ||||||||||||||||||||||||||||
Equipment [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Costs associated with KFC U.S. Acceleration Agreement | 6,000,000 | 6,000,000 | 17,000,000 | ||||||||||||||||||||||||||
Equipment [Member] | 2015 to 2019 [Member] | Franchise and property expenses [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Costs associated with KFC U.S. Acceleration Agreement | 130,000,000 | ||||||||||||||||||||||||||||
Franchisee Incentive Payments [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Costs associated with KFC U.S. Acceleration Agreement | 2,000,000 | 17,000,000 | |||||||||||||||||||||||||||
Incremental Advertising [Member] | KFC Global Division [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Costs associated with KFC U.S. Acceleration Agreement | 10,000,000 | 20,000,000 | |||||||||||||||||||||||||||
Incremental Advertising [Member] | KFC Global Division [Member] | Franchise and property expenses [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Costs associated with KFC U.S. Acceleration Agreement | 10,000,000 | 20,000,000 | |||||||||||||||||||||||||||
Incremental Advertising [Member] | 2015 to 2018 [Domain] | KFC Global Division [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Costs associated with KFC U.S. Acceleration Agreement | 60,000,000 | ||||||||||||||||||||||||||||
Franchise Incentive [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Other assets | (174,000,000) | (141,000,000) | (174,000,000) | (141,000,000) | (141,000,000) | (174,000,000) | (141,000,000) | ||||||||||||||||||||||
Executive Income Deferral Plan [Member] | Mark-to-Market of YUM China Funds [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
General and administrative expenses | 3,000,000 | 18,000,000 | 18,000,000 | ||||||||||||||||||||||||||
Executive Income Deferral Plan [Member] | Mark-to-Market of YUM China Funds [Member] | Corporate and Other [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
General and administrative expenses | 3,000,000 | 18,000,000 | |||||||||||||||||||||||||||
Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | Corporate and Other [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Depreciation | (1,000,000) | (3,000,000) | (10,000,000) | ||||||||||||||||||||||||||
Incremental Advertising [Member] | Pizza Hut Global Division [Member] | Franchise and property expenses [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Costs associated with PH U.S. Acceleration Agreement | 12,500,000 | 25,000,000 | |||||||||||||||||||||||||||
Accounting Standards Update 2014-09 [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Costs associated with KFC U.S. and PH U.S. Acceleration Agreement | 23,000,000 | ||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Deferred income taxes | $ 26,000,000 | ||||||||||||||||||||||||||||
Accumulated other comprehensive income (loss) | 21,000,000 | ||||||||||||||||||||||||||||
Accounting Standards Update 2014-09 [Member] | Franchise Incentive [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Prepaid Expense and Other Assets, Current | 18,000,000 | ||||||||||||||||||||||||||||
Other assets | (118,000,000) | ||||||||||||||||||||||||||||
Retained Earnings (Accumulated Deficit) | 136,000,000 | ||||||||||||||||||||||||||||
Balances with Adoption of Topic 842 [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Cash and cash equivalents | $ 292,000,000 | ||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Accounts and notes receivable, net | 561,000,000 | ||||||||||||||||||||||||||||
Prepaid Expense and Other Assets, Current | 344,000,000 | ||||||||||||||||||||||||||||
Assets, Current | 1,197,000,000 | ||||||||||||||||||||||||||||
Property, Plant and equipment, net | 1,237,000,000 | ||||||||||||||||||||||||||||
Goodwill | 525,000,000 | ||||||||||||||||||||||||||||
Intangible assets, net | 242,000,000 | ||||||||||||||||||||||||||||
Other assets | (1,413,000,000) | ||||||||||||||||||||||||||||
Deferred income taxes | 195,000,000 | ||||||||||||||||||||||||||||
Total Assets | 4,809,000,000 | ||||||||||||||||||||||||||||
Accounts payable and other current liabilities | 987,000,000 | ||||||||||||||||||||||||||||
Income taxes payable | 69,000,000 | ||||||||||||||||||||||||||||
Short-term borrowings | 321,000,000 | ||||||||||||||||||||||||||||
Liabilities, Current | 1,377,000,000 | ||||||||||||||||||||||||||||
Long-term debt | 9,751,000,000 | ||||||||||||||||||||||||||||
Other Liabilities, Noncurrent | 1,609,000,000 | ||||||||||||||||||||||||||||
Total Liabilities | 12,737,000,000 | ||||||||||||||||||||||||||||
Retained Earnings (Accumulated Deficit) | (7,594,000,000) | ||||||||||||||||||||||||||||
Accumulated other comprehensive income (loss) | (334,000,000) | ||||||||||||||||||||||||||||
Stockholders' Equity Attributable to Parent | (7,928,000,000) | ||||||||||||||||||||||||||||
Total Liabilities, Redeemable Noncontrolling Interest and Shareholders' Equity | 4,809,000,000 | ||||||||||||||||||||||||||||
Balances with Adoption of Topic 606 [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Cash and cash equivalents | 1,533,000,000 | ||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Accounts and notes receivable, net | 512,000,000 | ||||||||||||||||||||||||||||
Prepaid Expense and Other Assets, Current | 460,000,000 | ||||||||||||||||||||||||||||
Advertising cooperative assets, restricted | 0 | ||||||||||||||||||||||||||||
Assets, Current | 2,505,000,000 | ||||||||||||||||||||||||||||
Property, Plant and equipment, net | 1,596,000,000 | ||||||||||||||||||||||||||||
Goodwill | 512,000,000 | ||||||||||||||||||||||||||||
Intangible assets, net | 223,000,000 | ||||||||||||||||||||||||||||
Other assets | (463,000,000) | ||||||||||||||||||||||||||||
Deferred income taxes | 165,000,000 | ||||||||||||||||||||||||||||
Total Assets | 5,464,000,000 | ||||||||||||||||||||||||||||
Accounts payable and other current liabilities | 1,033,000,000 | ||||||||||||||||||||||||||||
Income taxes payable | 123,000,000 | ||||||||||||||||||||||||||||
Short-term borrowings | 375,000,000 | ||||||||||||||||||||||||||||
Advertising cooperative liabilities | 0 | ||||||||||||||||||||||||||||
Liabilities, Current | 1,531,000,000 | ||||||||||||||||||||||||||||
Long-term debt | 9,429,000,000 | ||||||||||||||||||||||||||||
Other Liabilities, Noncurrent | 1,057,000,000 | ||||||||||||||||||||||||||||
Total Liabilities | 12,017,000,000 | ||||||||||||||||||||||||||||
Retained Earnings (Accumulated Deficit) | (6,303,000,000) | ||||||||||||||||||||||||||||
Accumulated other comprehensive income (loss) | (250,000,000) | ||||||||||||||||||||||||||||
Stockholders' Equity Attributable to Parent | (6,553,000,000) | ||||||||||||||||||||||||||||
Total Liabilities, Redeemable Noncontrolling Interest and Shareholders' Equity | 5,464,000,000 | ||||||||||||||||||||||||||||
Previously Reported [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Cash and cash equivalents | 292,000,000 | 292,000,000 | 1,522,000,000 | 292,000,000 | 292,000,000 | ||||||||||||||||||||||||
Revenues | 5,688,000,000 | ||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
General and administrative expenses | 895,000,000 | ||||||||||||||||||||||||||||
Operating Profit | 2,296,000,000 | ||||||||||||||||||||||||||||
Investment Income, Net | 9,000,000 | ||||||||||||||||||||||||||||
Net Income (Loss) Attributable to Parent | $ 1,542,000,000 | ||||||||||||||||||||||||||||
Diluted EPS (in dollars per share) | $ / shares | $ 4.69 | ||||||||||||||||||||||||||||
Accounts and notes receivable, net | 561,000,000 | $ 561,000,000 | 400,000,000 | 561,000,000 | 561,000,000 | ||||||||||||||||||||||||
Prepaid Expense and Other Assets, Current | 354,000,000 | 354,000,000 | 384,000,000 | 354,000,000 | 354,000,000 | ||||||||||||||||||||||||
Advertising cooperative assets, restricted | 0 | 0 | 201,000,000 | 0 | 0 | ||||||||||||||||||||||||
Assets, Current | 1,207,000,000 | 1,207,000,000 | 2,507,000,000 | 1,207,000,000 | 1,207,000,000 | ||||||||||||||||||||||||
Property, Plant and equipment, net | 1,237,000,000 | 1,237,000,000 | 1,594,000,000 | 1,237,000,000 | 1,237,000,000 | ||||||||||||||||||||||||
Goodwill | 525,000,000 | 525,000,000 | 512,000,000 | 525,000,000 | 525,000,000 | ||||||||||||||||||||||||
Intangible assets, net | 242,000,000 | 242,000,000 | 214,000,000 | 242,000,000 | 242,000,000 | ||||||||||||||||||||||||
Other assets | (724,000,000) | (724,000,000) | (345,000,000) | (724,000,000) | (724,000,000) | ||||||||||||||||||||||||
Deferred income taxes | 195,000,000 | 195,000,000 | 139,000,000 | 195,000,000 | 195,000,000 | ||||||||||||||||||||||||
Total Assets | 4,130,000,000 | 4,130,000,000 | 5,311,000,000 | 4,130,000,000 | 4,130,000,000 | ||||||||||||||||||||||||
Accounts payable and other current liabilities | 911,000,000 | 911,000,000 | 813,000,000 | 911,000,000 | 911,000,000 | ||||||||||||||||||||||||
Income taxes payable | 69,000,000 | 69,000,000 | 123,000,000 | 69,000,000 | 69,000,000 | ||||||||||||||||||||||||
Short-term borrowings | 321,000,000 | 321,000,000 | 375,000,000 | 321,000,000 | 321,000,000 | ||||||||||||||||||||||||
Advertising cooperative liabilities | 0 | 0 | 201,000,000 | 0 | 0 | ||||||||||||||||||||||||
Liabilities, Current | 1,301,000,000 | 1,301,000,000 | 1,512,000,000 | 1,301,000,000 | 1,301,000,000 | ||||||||||||||||||||||||
Long-term debt | 9,751,000,000 | 9,751,000,000 | 9,429,000,000 | 9,751,000,000 | 9,751,000,000 | ||||||||||||||||||||||||
Other Liabilities, Noncurrent | 1,004,000,000 | 1,004,000,000 | 704,000,000 | 1,004,000,000 | 1,004,000,000 | ||||||||||||||||||||||||
Total Liabilities | 12,056,000,000 | 12,056,000,000 | 11,645,000,000 | 12,056,000,000 | 12,056,000,000 | ||||||||||||||||||||||||
Retained Earnings (Accumulated Deficit) | (7,592,000,000) | (7,592,000,000) | (6,063,000,000) | (7,592,000,000) | (7,592,000,000) | ||||||||||||||||||||||||
Accumulated other comprehensive income (loss) | (334,000,000) | (334,000,000) | (271,000,000) | (334,000,000) | (334,000,000) | ||||||||||||||||||||||||
Stockholders' Equity Attributable to Parent | (7,926,000,000) | (7,926,000,000) | (6,334,000,000) | (7,926,000,000) | (7,926,000,000) | ||||||||||||||||||||||||
Total Liabilities, Redeemable Noncontrolling Interest and Shareholders' Equity | 4,130,000,000 | 4,130,000,000 | 5,311,000,000 | 4,130,000,000 | 4,130,000,000 | ||||||||||||||||||||||||
Cost of Goods and Services Sold | 1,634,000,000 | ||||||||||||||||||||||||||||
Franchisor Costs | 188,000,000 | ||||||||||||||||||||||||||||
Cooperative Advertising Expense | 1,208,000,000 | ||||||||||||||||||||||||||||
Gain (Loss) on Disposition of Assets | 540,000,000 | ||||||||||||||||||||||||||||
Other Operating Income (Expense), Net | (7,000,000) | ||||||||||||||||||||||||||||
Operating Expenses | 3,392,000,000 | ||||||||||||||||||||||||||||
Other Pension (income) expense | 14,000,000 | ||||||||||||||||||||||||||||
Interest Income (Expense), Net | (452,000,000) | ||||||||||||||||||||||||||||
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | 1,839,000,000 | ||||||||||||||||||||||||||||
Income tax provision | $ 297,000,000 | ||||||||||||||||||||||||||||
Basic Earnings Per Common Share (in dollars per share) | $ / shares | $ 4.80 | ||||||||||||||||||||||||||||
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Cash and cash equivalents | (13,000,000) | $ (13,000,000) | (13,000,000) | (13,000,000) | 11,000,000 | ||||||||||||||||||||||||
Revenues | (1,163,000,000) | ||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
General and administrative expenses | 0 | ||||||||||||||||||||||||||||
Operating Profit | [12] | 14,000,000 | |||||||||||||||||||||||||||
Investment Income, Net | 0 | ||||||||||||||||||||||||||||
Net Income (Loss) Attributable to Parent | $ 11,000,000 | ||||||||||||||||||||||||||||
Diluted EPS (in dollars per share) | $ / shares | $ 0.03 | ||||||||||||||||||||||||||||
Accounts and notes receivable, net | (120,000,000) | $ (120,000,000) | (120,000,000) | (120,000,000) | 112,000,000 | ||||||||||||||||||||||||
Prepaid Expense and Other Assets, Current | (107,000,000) | (107,000,000) | (107,000,000) | (107,000,000) | 76,000,000 | [13] | |||||||||||||||||||||||
Advertising cooperative assets, restricted | 241,000,000 | 241,000,000 | 241,000,000 | 241,000,000 | (201,000,000) | ||||||||||||||||||||||||
Assets, Current | 1,000,000 | 1,000,000 | 1,000,000 | 1,000,000 | (2,000,000) | ||||||||||||||||||||||||
Property, Plant and equipment, net | (2,000,000) | (2,000,000) | (2,000,000) | (2,000,000) | 2,000,000 | ||||||||||||||||||||||||
Goodwill | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||
Intangible assets, net | (16,000,000) | (16,000,000) | (16,000,000) | (16,000,000) | 9,000,000 | ||||||||||||||||||||||||
Other assets | 127,000,000 | 127,000,000 | 127,000,000 | 127,000,000 | (118,000,000) | ||||||||||||||||||||||||
Deferred income taxes | (25,000,000) | (25,000,000) | (25,000,000) | (25,000,000) | 26,000,000 | ||||||||||||||||||||||||
Total Assets | (169,000,000) | (169,000,000) | (169,000,000) | (169,000,000) | 153,000,000 | ||||||||||||||||||||||||
Accounts payable and other current liabilities | (287,000,000) | (287,000,000) | (287,000,000) | (287,000,000) | 220,000,000 | ||||||||||||||||||||||||
Income taxes payable | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||
Short-term borrowings | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||
Advertising cooperative liabilities | 241,000,000 | 241,000,000 | 241,000,000 | 241,000,000 | (201,000,000) | ||||||||||||||||||||||||
Liabilities, Current | (46,000,000) | (46,000,000) | (46,000,000) | (46,000,000) | 19,000,000 | ||||||||||||||||||||||||
Long-term debt | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||
Other Liabilities, Noncurrent | (354,000,000) | (354,000,000) | (354,000,000) | (354,000,000) | 353,000,000 | ||||||||||||||||||||||||
Total Liabilities | (400,000,000) | (400,000,000) | (400,000,000) | (400,000,000) | 372,000,000 | ||||||||||||||||||||||||
Retained Earnings (Accumulated Deficit) | 2,000,000 | 251,000,000 | 2,000,000 | 251,000,000 | 251,000,000 | $ 2,000,000 | 251,000,000 | (240,000,000) | |||||||||||||||||||||
Accumulated other comprehensive income (loss) | (20,000,000) | (20,000,000) | (20,000,000) | (20,000,000) | 21,000,000 | ||||||||||||||||||||||||
Stockholders' Equity Attributable to Parent | 231,000,000 | 231,000,000 | 231,000,000 | 231,000,000 | (219,000,000) | ||||||||||||||||||||||||
Total Liabilities, Redeemable Noncontrolling Interest and Shareholders' Equity | (169,000,000) | (169,000,000) | (169,000,000) | (169,000,000) | 153,000,000 | ||||||||||||||||||||||||
Cost of Goods and Services Sold | 0 | ||||||||||||||||||||||||||||
Franchisor Costs | 27,000,000 | ||||||||||||||||||||||||||||
Cooperative Advertising Expense | (1,208,000,000) | ||||||||||||||||||||||||||||
Gain (Loss) on Disposition of Assets | (4,000,000) | ||||||||||||||||||||||||||||
Other Operating Income (Expense), Net | 0 | ||||||||||||||||||||||||||||
Operating Expenses | (1,177,000,000) | ||||||||||||||||||||||||||||
Other Pension (income) expense | 0 | ||||||||||||||||||||||||||||
Interest Income (Expense), Net | 0 | ||||||||||||||||||||||||||||
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | 14,000,000 | ||||||||||||||||||||||||||||
Income tax provision | $ 3,000,000 | ||||||||||||||||||||||||||||
Basic Earnings Per Common Share (in dollars per share) | $ / shares | $ 0.03 | ||||||||||||||||||||||||||||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Cash and cash equivalents | 279,000,000 | $ 279,000,000 | 279,000,000 | 279,000,000 | |||||||||||||||||||||||||
Revenues | 4,525,000,000 | ||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
General and administrative expenses | 895,000,000 | ||||||||||||||||||||||||||||
Operating Profit | 2,310,000,000 | ||||||||||||||||||||||||||||
Investment Income, Net | 9,000,000 | ||||||||||||||||||||||||||||
Net Income (Loss) Attributable to Parent | $ 1,553,000,000 | ||||||||||||||||||||||||||||
Diluted EPS (in dollars per share) | $ / shares | $ 4.72 | ||||||||||||||||||||||||||||
Accounts and notes receivable, net | 441,000,000 | $ 441,000,000 | 441,000,000 | 441,000,000 | |||||||||||||||||||||||||
Prepaid Expense and Other Assets, Current | 247,000,000 | 247,000,000 | 247,000,000 | 247,000,000 | |||||||||||||||||||||||||
Advertising cooperative assets, restricted | 241,000,000 | 241,000,000 | 241,000,000 | 241,000,000 | |||||||||||||||||||||||||
Assets, Current | 1,208,000,000 | 1,208,000,000 | 1,208,000,000 | 1,208,000,000 | |||||||||||||||||||||||||
Property, Plant and equipment, net | 1,235,000,000 | 1,235,000,000 | 1,235,000,000 | 1,235,000,000 | |||||||||||||||||||||||||
Goodwill | 525,000,000 | 525,000,000 | 525,000,000 | 525,000,000 | |||||||||||||||||||||||||
Intangible assets, net | 226,000,000 | 226,000,000 | 226,000,000 | 226,000,000 | |||||||||||||||||||||||||
Other assets | (597,000,000) | (597,000,000) | (597,000,000) | (597,000,000) | |||||||||||||||||||||||||
Deferred income taxes | 170,000,000 | 170,000,000 | 170,000,000 | 170,000,000 | |||||||||||||||||||||||||
Total Assets | 3,961,000,000 | 3,961,000,000 | 3,961,000,000 | 3,961,000,000 | |||||||||||||||||||||||||
Accounts payable and other current liabilities | 624,000,000 | 624,000,000 | 624,000,000 | 624,000,000 | |||||||||||||||||||||||||
Income taxes payable | 69,000,000 | 69,000,000 | 69,000,000 | 69,000,000 | |||||||||||||||||||||||||
Short-term borrowings | 321,000,000 | 321,000,000 | 321,000,000 | 321,000,000 | |||||||||||||||||||||||||
Advertising cooperative liabilities | 241,000,000 | 241,000,000 | 241,000,000 | 241,000,000 | |||||||||||||||||||||||||
Liabilities, Current | 1,255,000,000 | 1,255,000,000 | 1,255,000,000 | 1,255,000,000 | |||||||||||||||||||||||||
Long-term debt | 9,751,000,000 | 9,751,000,000 | 9,751,000,000 | 9,751,000,000 | |||||||||||||||||||||||||
Other Liabilities, Noncurrent | 650,000,000 | 650,000,000 | 650,000,000 | 650,000,000 | |||||||||||||||||||||||||
Total Liabilities | 11,656,000,000 | 11,656,000,000 | 11,656,000,000 | 11,656,000,000 | |||||||||||||||||||||||||
Retained Earnings (Accumulated Deficit) | (7,341,000,000) | (7,341,000,000) | (7,341,000,000) | (7,341,000,000) | |||||||||||||||||||||||||
Accumulated other comprehensive income (loss) | (354,000,000) | (354,000,000) | (354,000,000) | (354,000,000) | |||||||||||||||||||||||||
Stockholders' Equity Attributable to Parent | (7,695,000,000) | (7,695,000,000) | (7,695,000,000) | (7,695,000,000) | |||||||||||||||||||||||||
Total Liabilities, Redeemable Noncontrolling Interest and Shareholders' Equity | 3,961,000,000 | 3,961,000,000 | 3,961,000,000 | 3,961,000,000 | |||||||||||||||||||||||||
Cost of Goods and Services Sold | 1,634,000,000 | ||||||||||||||||||||||||||||
Franchisor Costs | 215,000,000 | ||||||||||||||||||||||||||||
Cooperative Advertising Expense | 0 | ||||||||||||||||||||||||||||
Gain (Loss) on Disposition of Assets | 536,000,000 | ||||||||||||||||||||||||||||
Other Operating Income (Expense), Net | (7,000,000) | ||||||||||||||||||||||||||||
Operating Expenses | 2,215,000,000 | ||||||||||||||||||||||||||||
Other Pension (income) expense | 14,000,000 | ||||||||||||||||||||||||||||
Interest Income (Expense), Net | (452,000,000) | ||||||||||||||||||||||||||||
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | 1,853,000,000 | ||||||||||||||||||||||||||||
Income tax provision | $ 300,000,000 | ||||||||||||||||||||||||||||
Basic Earnings Per Common Share (in dollars per share) | $ / shares | $ 4.83 | ||||||||||||||||||||||||||||
Advertising Cooperatives [Domain] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Cash and cash equivalents | 11,000,000 | ||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Restricted Cash | 58,000,000 | ||||||||||||||||||||||||||||
Up-front Payment Arrangement [Member] | Accounting Standards Update 2014-09 [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Accounts payable and other current liabilities | 57,000,000 | ||||||||||||||||||||||||||||
Other Liabilities, Noncurrent | 335,000,000 | ||||||||||||||||||||||||||||
Retained Earnings (Accumulated Deficit) | $ (392,000,000) | ||||||||||||||||||||||||||||
Advertising [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 434,000,000 | $ 330,000,000 | $ 318,000,000 | $ 309,000,000 | 372,000,000 | $ 287,000,000 | $ 272,000,000 | $ 275,000,000 | 1,391,000,000 | $ 1,206,000,000 | 0 | ||||||||||||||||||
Advertising [Member] | Previously Reported [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 1,206,000,000 | ||||||||||||||||||||||||||||
Advertising [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | (1,206,000,000) | ||||||||||||||||||||||||||||
Advertising [Member] | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | ||||||||||||||||||||||||||||
Product [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 490,000,000 | 364,000,000 | 359,000,000 | 333,000,000 | 477,000,000 | 499,000,000 | 512,000,000 | 512,000,000 | 1,546,000,000 | 2,000,000,000 | 3,572,000,000 | ||||||||||||||||||
Product [Member] | Previously Reported [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 2,000,000,000 | ||||||||||||||||||||||||||||
Product [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | ||||||||||||||||||||||||||||
Product [Member] | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 2,000,000,000 | ||||||||||||||||||||||||||||
Franchise and property revenue [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 770,000,000 | $ 645,000,000 | $ 633,000,000 | $ 612,000,000 | 709,000,000 | $ 605,000,000 | 584,000,000 | $ 584,000,000 | 2,660,000,000 | 2,482,000,000 | $ 2,306,000,000 | ||||||||||||||||||
Franchise and property revenue [Member] | Previously Reported [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 2,482,000,000 | ||||||||||||||||||||||||||||
Franchise and property revenue [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 43,000,000 | ||||||||||||||||||||||||||||
Franchise and property revenue [Member] | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 2,525,000,000 | ||||||||||||||||||||||||||||
Goodwill [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Goodwill | 39,000,000 | 39,000,000 | 39,000,000 | 39,000,000 | |||||||||||||||||||||||||
Goodwill [Member] | KFC Global Division [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Goodwill | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||
Goodwill [Member] | Pizza Hut Global Division [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Goodwill | 39,000,000 | 39,000,000 | 39,000,000 | 39,000,000 | |||||||||||||||||||||||||
Goodwill [Member] | Taco Bell Global Division [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Goodwill | $ 0 | 0 | $ 0 | $ 0 | |||||||||||||||||||||||||
Accounting Standards Update 2016-02 [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Cash and cash equivalents | 0 | ||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Accounts and notes receivable, net | 0 | ||||||||||||||||||||||||||||
Prepaid Expense and Other Assets, Current | (10,000,000) | ||||||||||||||||||||||||||||
Assets, Current | (10,000,000) | ||||||||||||||||||||||||||||
Property, Plant and equipment, net | 0 | ||||||||||||||||||||||||||||
Goodwill | 0 | ||||||||||||||||||||||||||||
Intangible assets, net | 0 | ||||||||||||||||||||||||||||
Other assets | (689,000,000) | ||||||||||||||||||||||||||||
Deferred income taxes | 0 | ||||||||||||||||||||||||||||
Total Assets | 679,000,000 | ||||||||||||||||||||||||||||
Accounts payable and other current liabilities | 76,000,000 | ||||||||||||||||||||||||||||
Income taxes payable | 0 | ||||||||||||||||||||||||||||
Short-term borrowings | 0 | ||||||||||||||||||||||||||||
Liabilities, Current | 76,000,000 | ||||||||||||||||||||||||||||
Long-term debt | 0 | ||||||||||||||||||||||||||||
Other Liabilities, Noncurrent | 605,000,000 | ||||||||||||||||||||||||||||
Total Liabilities | 681,000,000 | ||||||||||||||||||||||||||||
Retained Earnings (Accumulated Deficit) | (2,000,000) | ||||||||||||||||||||||||||||
Accumulated other comprehensive income (loss) | 0 | ||||||||||||||||||||||||||||
Stockholders' Equity Attributable to Parent | (2,000,000) | ||||||||||||||||||||||||||||
Total Liabilities, Redeemable Noncontrolling Interest and Shareholders' Equity | 679,000,000 | ||||||||||||||||||||||||||||
Accounting Standards Update 2016-02 [Member] | Lease Right of Use Asset [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Other assets | (690,000,000) | ||||||||||||||||||||||||||||
Present Value of Operating Lease Payments [Member] | Accounting Standards Update 2016-02 [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Accounts payable and other current liabilities | 83,000,000 | ||||||||||||||||||||||||||||
Other Liabilities, Noncurrent | 661,000,000 | ||||||||||||||||||||||||||||
Write off impact of recognizing rent expense on straight line basis [Member] | Accounting Standards Update 2016-02 [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Accounts payable and other current liabilities | 7,000,000 | ||||||||||||||||||||||||||||
Other Liabilities, Noncurrent | 56,000,000 | ||||||||||||||||||||||||||||
Write off of prepaid rent recorded under Legacy GAAP [Member] | Accounting Standards Update 2016-02 [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Prepaid Expense and Other Assets, Current | 11,000,000 | ||||||||||||||||||||||||||||
Other assets | $ 1,000,000 | ||||||||||||||||||||||||||||
GrubHub Inc. [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Equity Securities, FV-NI, Cost | $ 200,000,000 | ||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Investment Income, Net | $ (77,000,000) | $ 14,000,000 | |||||||||||||||||||||||||||
Investment Owned, Balance, Shares | shares | 2.8 | ||||||||||||||||||||||||||||
GrubHub Inc. [Member] | Investment closing date [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Time period shares are restricted from being transferred | 2 years | ||||||||||||||||||||||||||||
GrubHub Inc. [Member] | Termination of Master Services Agreement [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Time period shares are restricted from being transferred | 30 days | ||||||||||||||||||||||||||||
Intra-Entity IP Transfers [Member] | |||||||||||||||||||||||||||||
Activity related to reserves for remaining lease obligations for closed stores [Roll Forward] | |||||||||||||||||||||||||||||
Deferred Income Tax Expense (Benefit) | $ 226,000,000 | ||||||||||||||||||||||||||||
2018 [Member] | |||||||||||||||||||||||||||||
Facility Actions [Line Items] | |||||||||||||||||||||||||||||
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Amount | $ 35,000,000 | ||||||||||||||||||||||||||||
[1] | Includes net gains from refranchising initiatives of $6 million , $4 million , $8 million and $19 million in the first, second, third and fourth quarters, respectively. | ||||||||||||||||||||||||||||
[2] | Includes net gains from refranchising initiatives of $156 million , $29 million , $100 million and $255 million in the first, second, third and fourth quarters, respectively. | ||||||||||||||||||||||||||||
[3] | Amounts have not been allocated to any segment for performance reporting purposes. | ||||||||||||||||||||||||||||
[4] | Goodwill, net includes $17 million of accumulated impairment losses for each year presented related to our Pizza Hut segment. | ||||||||||||||||||||||||||||
[5] | U.S. identifiable assets included in the combined Corporate and KFC, Pizza Hut and Taco Bell Divisions totaled $2.7 billion and $2.0 billion in 2019 and 2018, respectively. | ||||||||||||||||||||||||||||
[6] | Amounts in 2017 include a non-cash charge of $22 million related to the adjustment of certain historical deferred vested liability balances in our qualified U.S. plan. See Note 4. | ||||||||||||||||||||||||||||
[7] | Represents costs associated with the KFC U.S. Acceleration Agreement and Pizza Hut U.S. Transformation Agreement. See Note 4. | ||||||||||||||||||||||||||||
[8] | Amounts in 2018 include costs related to YUM's Strategic Transformation Initiatives of $8 million , partially offset by non-cash credits associated with modifications of share-based compensation awards of $3 million . Amounts in 2017 include costs related to YUM’s Strategic Transformation Initiatives of $21 million , non-cash charges associated with modifications of share-based compensation awards of $18 million and costs associated with the Pizza Hut U.S. Transformation Agreement of $13 million . See Note 4. | ||||||||||||||||||||||||||||
[9] | Primarily includes cash, our Grubhub investment and deferred tax assets. | ||||||||||||||||||||||||||||
[10] | Represents depreciation reductions arising primarily from KFC restaurants that were held for sale. See Note 4. | ||||||||||||||||||||||||||||
[11] | U.S. revenues included in the combined KFC, Pizza Hut and Taco Bell Divisions totaled $3.0 billion in 2019, $2.9 billion in 2018 and $2.8 billion in 2017. | ||||||||||||||||||||||||||||
[12] | Includes $23 million of franchise incentive payments made to or on behalf of franchisees during 2018 that under Legacy Revenue GAAP would have been recognized as expense in full in 2018. Due to the size and nature of such payments, we historically would not have allocated their impact to our Divisional results. Upon the adoption of Topic 606, these payments have been capitalized as assets. | ||||||||||||||||||||||||||||
[13] | (a) Includes $58 million of restricted cash related to advertising cooperatives. These balances can only be used to settle obligations of the respective cooperatives. |
Note 5. Revenue Recognition (De
Note 5. Revenue Recognition (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2018 | |||
Deferred Revenue, Revenue Recognized | $ (70) | $ (66) | ||||||||||||
Rental income | $ 86 | |||||||||||||
Revenues | $ 1,694 | $ 1,339 | $ 1,310 | $ 1,254 | $ 1,558 | $ 1,391 | $ 1,368 | $ 1,371 | 5,597 | 5,688 | 5,878 | |||
Deferred Revenue, Additions | 93 | 102 | ||||||||||||
Deferred Revenue | 441 | 414 | 441 | 414 | $ 392 | |||||||||
Product [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 490 | 364 | 359 | 333 | 477 | 499 | 512 | 512 | 1,546 | 2,000 | 3,572 | |||
Advertising [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 434 | $ 330 | $ 318 | $ 309 | $ 372 | $ 287 | $ 272 | $ 275 | 1,391 | 1,206 | 0 | |||
United States | ||||||||||||||
Rental income | 70 | 54 | ||||||||||||
United States | Product [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 1,014 | 1,143 | ||||||||||||
United States | Franchise [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 1,059 | 994 | ||||||||||||
United States | Advertising [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 811 | 706 | ||||||||||||
CHINA | Franchise [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 274 | 260 | ||||||||||||
Other, Outside the U.S. and China [Member] | ||||||||||||||
Rental income | 72 | 77 | ||||||||||||
Other, Outside the U.S. and China [Member] | Product [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 532 | 857 | ||||||||||||
Other, Outside the U.S. and China [Member] | Franchise [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 1,185 | 1,097 | ||||||||||||
Other, Outside the U.S. and China [Member] | Advertising [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 580 | 500 | ||||||||||||
KFC Global Division [Member] | ||||||||||||||
Revenues | [1] | 2,491 | 2,644 | 3,110 | ||||||||||
KFC Global Division [Member] | United States | ||||||||||||||
Rental income | 20 | 23 | ||||||||||||
KFC Global Division [Member] | United States | Product [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 74 | 72 | ||||||||||||
KFC Global Division [Member] | United States | Franchise [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 175 | 171 | ||||||||||||
KFC Global Division [Member] | United States | Advertising [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 10 | 9 | ||||||||||||
KFC Global Division [Member] | CHINA | Franchise [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 214 | 201 | ||||||||||||
KFC Global Division [Member] | Other, Outside the U.S. and China [Member] | ||||||||||||||
Rental income | 69 | 74 | ||||||||||||
KFC Global Division [Member] | Other, Outside the U.S. and China [Member] | Product [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 497 | 822 | ||||||||||||
KFC Global Division [Member] | Other, Outside the U.S. and China [Member] | Franchise [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 912 | 825 | ||||||||||||
KFC Global Division [Member] | Other, Outside the U.S. and China [Member] | Advertising [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 520 | 447 | ||||||||||||
Pizza Hut Global Division [Member] | ||||||||||||||
Revenues | [1] | 1,027 | 988 | 893 | ||||||||||
Pizza Hut Global Division [Member] | United States | ||||||||||||||
Rental income | 6 | 4 | ||||||||||||
Pizza Hut Global Division [Member] | United States | Product [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 21 | 37 | ||||||||||||
Pizza Hut Global Division [Member] | United States | Franchise [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 282 | 284 | ||||||||||||
Pizza Hut Global Division [Member] | United States | Advertising [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 318 | 269 | ||||||||||||
Pizza Hut Global Division [Member] | CHINA | Franchise [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 60 | 59 | ||||||||||||
Pizza Hut Global Division [Member] | Other, Outside the U.S. and China [Member] | ||||||||||||||
Rental income | 3 | 3 | ||||||||||||
Pizza Hut Global Division [Member] | Other, Outside the U.S. and China [Member] | Product [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 33 | 32 | ||||||||||||
Pizza Hut Global Division [Member] | Other, Outside the U.S. and China [Member] | Franchise [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 246 | 248 | ||||||||||||
Pizza Hut Global Division [Member] | Other, Outside the U.S. and China [Member] | Advertising [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 58 | 52 | ||||||||||||
Taco Bell Global Division [Member] | ||||||||||||||
Revenues | [1] | 2,079 | 2,056 | $ 1,880 | ||||||||||
Taco Bell Global Division [Member] | United States | ||||||||||||||
Rental income | 44 | 27 | ||||||||||||
Taco Bell Global Division [Member] | United States | Product [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 919 | 1,034 | ||||||||||||
Taco Bell Global Division [Member] | United States | Franchise [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 602 | 539 | ||||||||||||
Taco Bell Global Division [Member] | United States | Advertising [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 483 | 428 | ||||||||||||
Taco Bell Global Division [Member] | CHINA | Franchise [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | ||||||||||||
Taco Bell Global Division [Member] | Other, Outside the U.S. and China [Member] | ||||||||||||||
Rental income | 0 | 0 | ||||||||||||
Taco Bell Global Division [Member] | Other, Outside the U.S. and China [Member] | Product [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 2 | 3 | ||||||||||||
Taco Bell Global Division [Member] | Other, Outside the U.S. and China [Member] | Franchise [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 27 | 24 | ||||||||||||
Taco Bell Global Division [Member] | Other, Outside the U.S. and China [Member] | Advertising [Member] | ||||||||||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 2 | 1 | ||||||||||||
Foreign Currency Gain (Loss) and Refranchising Gain (Loss) [Member] | ||||||||||||||
Deferred Revenue, Period Increase (Decrease) | $ 4 | $ (14) | [2] | |||||||||||
[1] | U.S. revenues included in the combined KFC, Pizza Hut and Taco Bell Divisions totaled $3.0 billion in 2019, $2.9 billion in 2018 and $2.8 billion in 2017. | |||||||||||||
[2] | (a) Includes impact of foreign currency translation as well as, in 2018, the recognition of deferred franchise fees into Refranchising (gain) loss upon the modification of existing franchise agreements when entering into master franchise agreements. |
Supplemental Cash Flow Data (De
Supplemental Cash Flow Data (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2018 | ||
Cash Paid For: | |||||
Interest Paid, Excluding Capitalized Interest, Operating Activities | $ 497 | $ 455 | $ 442 | ||
Income taxes | 283 | 279 | 346 | ||
Significant Non-Cash Investing and Financing Activities: | |||||
Capital lease obligations incurred | 14 | 4 | 8 | ||
Capital lease and other debt obligations transferred through refranchising | (1) | (24) | (35) | ||
Cash and Cash Equivalents, at Carrying Value | 605 | 292 | 1,522 | ||
Restricted Cash and Cash Equivalents, Current | 138 | 151 | |||
Cash, Cash Equivalents and Restricted Cash as presented in the Consolidated Statement of Cash Flows | [1] | 768 | 474 | 1,599 | |
Prepaid Expenses and Other Current Assets [Member] | |||||
Significant Non-Cash Investing and Financing Activities: | |||||
Restricted Cash and Cash Equivalents, Current | [2] | 138 | 151 | 60 | |
Other Assets [Member] | |||||
Significant Non-Cash Investing and Financing Activities: | |||||
Restricted Cash and Cash Equivalents, Noncurrent | [3] | $ 25 | $ 31 | $ 17 | |
Advertising Cooperatives [Domain] | |||||
Restricted Cash | $ 58 | ||||
Significant Non-Cash Investing and Financing Activities: | |||||
Cash and Cash Equivalents, at Carrying Value | $ 11 | ||||
[1] | Upon adoption of Topic 606 we reclassified cash of $11 million and restricted cash of $58 million , respectively, from Advertising cooperative assets, restricted to Cash and cash equivalents and Prepaid expenses and other current assets. These amounts are included in the Beginning of Year balance of Cash, Cash Equivalents, Restricted Cash and Restricted Cash equivalents in our Consolidated Statement of Cash Flows for the year ended December 31, 2018. | ||||
[2] | Restricted cash within Prepaid expenses and other current assets reflects Taco Bell Securitization interest reserves (See Note 10) and the cash related to advertising cooperatives that we consolidate that can only be used to settle obligations of the respective cooperatives. | ||||
[3] | Primarily trust accounts related to our self-insurance program. |
Other (Income) Expense (Details
Other (Income) Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Other Income and Expenses [Line Items] | |||
Foreign currency transaction (gain) loss and other (income) expense, before tax | $ (1) | $ 1 | $ 7 |
Closures and impairment (income) expenses | 5 | 6 | 3 |
Other Operating Income (Expense), Net | $ (4) | $ (7) | $ (10) |
Supplemental Balance Sheet In_3
Supplemental Balance Sheet Information (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Property, Plant and Equipment [Line Items] | ||||
Property, Plant and equipment, gross | $ 2,306 | $ 2,353 | ||
Accumulated depreciation and amortization | (1,136) | (1,116) | ||
Property, Plant and equipment, net | 1,170 | 1,237 | ||
Depreciation and amortization | 114 | 146 | $ 215 | |
Accounts Payable and Other Current Liabilities | ||||
Accounts payable | 173 | 202 | ||
Accrued compensation and benefits | 223 | 206 | ||
Accrued Advertising, Current | 96 | 108 | ||
Operating Lease, Liability, Current | 67 | 0 | ||
Accrued taxes, other than income taxes | 52 | 48 | ||
Other current liabilities | 349 | 347 | ||
Accounts payable and other current liabilities | 960 | 911 | ||
Prepaid Expenses and Other Current Assets | ||||
Income tax receivable | 39 | 36 | ||
Restricted Cash and Cash Equivalents, Current | 138 | 151 | ||
Assets held for sale | [1] | 25 | 24 | |
Prepaid Expense and Other Assets, Current | 338 | 354 | ||
Prepaid expenses and other current assets | 136 | 143 | ||
Land | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, Plant and equipment, gross | 408 | 422 | ||
Buildings and improvements | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, Plant and equipment, gross | 1,325 | 1,349 | ||
Capital leases, primarily buildings | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, Plant and equipment, gross | 68 | 59 | ||
Machinery and equipment | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, Plant and equipment, gross | 505 | 523 | ||
Prepaid Expenses and Other Current Assets [Member] | ||||
Prepaid Expenses and Other Current Assets | ||||
Restricted Cash and Cash Equivalents, Current | [2] | $ 138 | $ 151 | $ 60 |
[1] | (a) Reflects the carrying value of restaurants we have offered for sale to franchisees and excess properties that we do not intend to use for restaurant operations in the future. | |||
[2] | Restricted cash within Prepaid expenses and other current assets reflects Taco Bell Securitization interest reserves (See Note 10) and the cash related to advertising cooperatives that we consolidate that can only be used to settle obligations of the respective cooperatives. |
Note 8. Supplemental Balance Sh
Note 8. Supplemental Balance Sheet Information Other Assets, Noncurrent (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | Jan. 01, 2018 | |
Other Assets, Noncurrent [Line Items] | ||||
Operating Lease, Right-of-Use Asset | [1] | $ 642 | $ 0 | |
Other assets | 1,313 | 724 | ||
Other Assets, Miscellaneous, Noncurrent | 360 | 369 | ||
Franchise Incentive [Member] | ||||
Other Assets, Noncurrent [Line Items] | ||||
Other assets | 174 | 141 | ||
Franchise Incentive [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Other Assets, Noncurrent [Line Items] | ||||
Other assets | $ 118 | |||
GrubHub Inc. [Member] | Fair Value, Inputs, Level 1 [Member] | Other Assets [Member] | Fair Value, Recurring [Member] | ||||
Other Assets, Noncurrent [Line Items] | ||||
Equity Securities, FV-NI | [2] | $ 137 | $ 214 | |
[1] | (b) Increase from 2018 primarily due to the adoption of Topic 842 beginning with the year ended December 31, 2019. See Notes 2 and 4 for further discussion. | |||
[2] | (c) Refer to Note 4 for additional discussion regarding our investment in Grubhub. |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Goodwill [Line Items] | ||||
Business Combination, Consideration Transferred | $ 375 | $ 77 | ||
Payments to Acquire Businesses, Net of Cash Acquired | 0 | 66 | $ 0 | |
Business Combination, Consideration Transferred, Other | 6 | |||
Business Combination, Contingent Consideration, Liability | 5 | |||
Business Acquisition, Goodwill, Expected Tax Deductible Amount | 39 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 33 | |||
Changes in the carrying amount of goodwill [Roll Forward] | ||||
Goodwill | [1] | 530 | 525 | 512 |
Disposals and other, net | [2] | 5 | (26) | |
KFC Global Division [Member] | ||||
Changes in the carrying amount of goodwill [Roll Forward] | ||||
Goodwill | [1] | 233 | 230 | 247 |
Disposals and other, net | [2] | 3 | (17) | |
Pizza Hut Global Division [Member] | ||||
Changes in the carrying amount of goodwill [Roll Forward] | ||||
Goodwill | [1] | 199 | 196 | 162 |
Disposals and other, net | [2] | 3 | (5) | |
Accumulated impairment losses (ending balance) | [1] | (17) | ||
Taco Bell Global Division [Member] | ||||
Changes in the carrying amount of goodwill [Roll Forward] | ||||
Goodwill | [1] | 98 | 99 | $ 103 |
Disposals and other, net | [2] | $ (1) | (4) | |
Goodwill [Member] | ||||
Changes in the carrying amount of goodwill [Roll Forward] | ||||
Goodwill | 39 | |||
Goodwill [Member] | KFC Global Division [Member] | ||||
Changes in the carrying amount of goodwill [Roll Forward] | ||||
Goodwill | 0 | |||
Goodwill [Member] | Pizza Hut Global Division [Member] | ||||
Changes in the carrying amount of goodwill [Roll Forward] | ||||
Goodwill | 39 | |||
Goodwill [Member] | Taco Bell Global Division [Member] | ||||
Changes in the carrying amount of goodwill [Roll Forward] | ||||
Goodwill | $ 0 | |||
[1] | Goodwill, net includes $17 million of accumulated impairment losses for each year presented related to our Pizza Hut segment. | |||
[2] | Disposals and other, net includes the impact of foreign currency translation on existing balances and goodwill write-offs associated with refranchising. |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets (Details 2) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Definite-lived intangible assets | |||
Gross Carrying Amount | $ 487 | $ 504 | |
Accumulated Amortization | (274) | (293) | |
Definite-lived intangible assets, amortization expense | 52 | 37 | $ 33 |
Approximate amortization expense for definite-lived intangible assets - 2016 | 53 | ||
Approximate amortization expense for definite-lived intangible assets - 2017 | 42 | ||
Approximate amortization expense for definite-lived intangible assets - 2018 | 25 | ||
Approximate amortization expense for definite-lived intangible assets - 2019 | 19 | ||
Approximate amortization expense for definite-lived intangible assets - 2020 | 14 | ||
Capitalized software costs | |||
Definite-lived intangible assets | |||
Gross Carrying Amount | 306 | 319 | |
Accumulated Amortization | (130) | (156) | |
Franchise contract rights [Member] | |||
Definite-lived intangible assets | |||
Gross Carrying Amount | 100 | 99 | |
Accumulated Amortization | (83) | (79) | |
Lease tenancy rights [Member] | |||
Definite-lived intangible assets | |||
Gross Carrying Amount | 5 | 11 | |
Accumulated Amortization | (1) | (1) | |
Reacquired franchise rights [Member] | |||
Definite-lived intangible assets | |||
Gross Carrying Amount | 38 | 37 | |
Accumulated Amortization | (32) | (30) | |
Other [Member] | |||
Definite-lived intangible assets | |||
Gross Carrying Amount | 38 | 38 | |
Accumulated Amortization | (28) | (27) | |
KFC Global Division [Member] | Trademarks/brands [Member] | |||
Indefinite-lived intangible assets | |||
Gross Carrying Amount | $ 31 | $ 31 |
Short-term Borrowings and Lon_3
Short-term Borrowings and Long-term Debt (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Debt Instrument [Line Items] | ||||
Long-term Debt and Lease Obligation, Current | $ (437,000,000) | $ (331,000,000) | ||
Debt Issuance Costs, Current, Net | (10,000,000) | (10,000,000) | ||
Short-term Borrowings | ||||
Total Short-term Borrowings | 431,000,000 | 321,000,000 | ||
Long-term Debt | ||||
Long-term debt including hedge accounting adjustment | 10,131,000,000 | 9,751,000,000 | ||
Capital Lease Obligations Excluded from Annual Maturities | 77,000,000 | |||
Line of Credit Facility [Abstract] | ||||
Capital Lease Obligations, Noncurrent | 77,000,000 | 71,000,000 | ||
Long-term debt and capital less obligations, excluding current maturities and debt issuance costs | 10,648,000,000 | 10,167,000,000 | ||
Debt Issuance Costs, Noncurrent, Net | (80,000,000) | (85,000,000) | ||
Senior Unsecured Notes [Abstract] | ||||
Long-term Debt, Current Maturities | 441,000,000 | 331,000,000 | ||
Other Short-term Borrowings | 4,000,000 | 0 | ||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
2016 | 434,000,000 | |||
2017 | 455,000,000 | |||
2018 | 424,000,000 | |||
2019 | 1,626,000,000 | |||
2020 | 1,086,000,000 | |||
Thereafter | 6,550,000,000 | |||
Total | 10,575,000,000 | |||
Interest expense on short-term borrowings and long-term debt | 519,000,000 | 496,000,000 | $ 473,000,000 | |
Restricted Cash and Cash Equivalents, Current | 138,000,000 | 151,000,000 | ||
Payments of Debt Issuance Costs | 10,000,000 | 13,000,000 | 32,000,000 | |
Interest Income (Expense), Net | [1] | $ (486,000,000) | (452,000,000) | (445,000,000) |
Senior Unsecured Notes Due November 2037 [Member] | ||||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | Oct. 19, 2007 | |||
Maturity date | Nov. 15, 2037 | |||
Interest rate, stated (in hundredths) | 6.88% | |||
Interest rate, effective (in hundredths) | [2] | 7.45% | ||
Debt Instrument, Face Amount | $ 325,000,000 | |||
Senior Unsecured Notes Due September 2019 [Member] | ||||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | Aug. 25, 2009 | |||
Maturity date | Sep. 15, 2019 | |||
Senior Unsecured Notes Due November 2020 [Member] | ||||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | Aug. 31, 2010 | |||
Maturity date | Nov. 1, 2020 | |||
Interest rate, stated (in hundredths) | 3.88% | |||
Interest rate, effective (in hundredths) | [2] | 4.01% | ||
Debt Instrument, Face Amount | $ 350,000,000 | |||
Senior Unsecured Notes Due November 2021 [Member] | ||||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | Aug. 29, 2011 | |||
Maturity date | Nov. 1, 2021 | |||
Interest rate, stated (in hundredths) | 3.75% | |||
Interest rate, effective (in hundredths) | [2] | 3.88% | ||
Debt Instrument, Face Amount | $ 350,000,000 | |||
Senior Unsecured Notes Due November 2023 [Member] | ||||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | Oct. 31, 2013 | |||
Maturity date | Nov. 1, 2023 | |||
Interest rate, stated (in hundredths) | 3.88% | |||
Interest rate, effective (in hundredths) | [2] | 4.01% | ||
Debt Instrument, Face Amount | $ 325,000,000 | |||
Senior Unsecured Notes Due November 2043 [Member] | ||||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | Oct. 31, 2013 | |||
Maturity date | Nov. 1, 2043 | |||
Interest rate, stated (in hundredths) | 5.35% | |||
Interest rate, effective (in hundredths) | [2] | 5.42% | ||
Debt Instrument, Face Amount | $ 275,000,000 | |||
Senior Unsecured Notes Due January 2030 [Member] | ||||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | Sep. 11, 2019 | |||
Maturity date | Jan. 15, 2030 | |||
Interest rate, stated (in hundredths) | 4.75% | |||
Interest rate, effective (in hundredths) | [2] | 4.90% | ||
Debt Instrument, Face Amount | $ 800,000,000 | |||
Term Loan A Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt | $ 463,000,000 | |||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | Jun. 16, 2016 | |||
Maturity date | Jun. 7, 2022 | |||
Term Loan B Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt | $ 1,935,000,000 | |||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | Jun. 16, 2016 | |||
Maturity date | Apr. 3, 2025 | |||
Subsidiary Senior Unsecured Notes due 2024 [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt | $ 1,050,000,000 | |||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | Jun. 15, 2016 | |||
Maturity date | May 31, 2024 | |||
Interest rate, stated (in hundredths) | 5.00% | |||
Subsidiary Senior Unsecured Notes due 2026 [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt | $ 1,050,000,000 | |||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | Jun. 15, 2016 | |||
Maturity date | May 31, 2026 | |||
Interest rate, stated (in hundredths) | 5.25% | |||
Subsidiary Senior Unsecured Notes due 2027 [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt | $ 750,000,000 | |||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | Jun. 15, 2017 | |||
Maturity date | May 31, 2027 | |||
Interest rate, stated (in hundredths) | 4.75% | |||
Secured Debt [Member] | Term Loan A Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt | [3] | $ 463,000,000 | 488,000,000 | |
Senior Unsecured Notes [Abstract] | ||||
Maturity date | Jun. 7, 2022 | |||
Interest rate, effective (in hundredths) | [4] | 3.46% | ||
Frequency of interest payments | quarterly | |||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Term Loan A Facility, Repayments of Principal in Year Two and Three | 1.25% | |||
Term Loan A Facility, Repayments of Principal in Year Four | 1.875% | |||
Term Loan A, Repayments of Principal in Year Five | 3.75% | |||
Secured Debt [Member] | Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Repayments of Debt | $ 250,000,000 | |||
Line of Credit Facility [Abstract] | ||||
Line of credit facility, maximum borrowing capacity | 1,000,000,000 | |||
Secured Debt [Member] | Term Loan B Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt | [3] | $ 1,935,000,000 | 1,955,000,000 | |
Senior Unsecured Notes [Abstract] | ||||
Maturity date | Apr. 3, 2025 | |||
Interest rate, effective (in hundredths) | [4] | 3.65% | ||
Frequency of interest payments | quarterly | |||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Term Loan B, Repayment of Principal | 0.25% | |||
Secured Debt [Member] | Class A-2 Notes [Member] | ||||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | May 11, 2016 | |||
Maturity date | May 1, 2046 | |||
Secured Debt [Member] | Revolving Facility [Member] | ||||
Line of Credit Facility [Abstract] | ||||
Line of credit facility, maximum borrowing capacity | $ 1,000,000,000 | |||
Outstanding borrowings | $ 0 | |||
Secured Debt [Member] | the Credit Agreement [Member] | ||||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | Jun. 16, 2016 | |||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Debt Instrument, Payment Terms | The Credit Agreement is subject to certain mandatory prepayments, including an amount equal to 50% of excess cash flow (as defined in the Credit Agreement) on an annual basis and the proceeds of certain asset sales, casualty events and issuances of indebtedness, subject to customary exceptions and reinvestment rights | |||
Debt Instrument, Covenant Compliance | We were in compliance with all debt covenants as of December 31, 2019 | |||
Secured Debt [Member] | Securitization Notes [Member] | ||||
Short-term Borrowings | ||||
Senior Notes, Noncurrent | [5] | $ 2,898,000,000 | 2,928,000,000 | |
Senior Unsecured Notes [Abstract] | ||||
Frequency of interest payments | quarterly | |||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Debt Instrument, Payment Terms | no amortization of principal of the Securitization Notes is required prior to their anticipated repayment dates | |||
Debt Instrument, Debt Default, Description of Violation or Event of Default | The Securitization Notes are also subject to certain customary events of default, including events relating to non-payment of required interest or principal due on the Securitization Notes, failure to comply with covenants within certain time frames, certain bankruptcy events, breaches of specified representations and warranties, failure of security interests to be effective, certain judgments and failure of the Securitization Entities to maintain a stated debt service coverage ratio | |||
Debt Instrument, Covenant Compliance | As of December 31, 2019, we were in compliance with all of our debt covenant requirements and were not subject to any rapid amortization events | |||
Long-term Debt, Contingent Payment of Principal or Interest | as of any quarterly measurement date the consolidated leverage ratio (the ratio of total debt to Net Cash Flow (as defined in the related indenture)) for the preceding four fiscal quarters of either the Company and its subsidiaries or the Issuer and its subsidiaries exceeds 5.0:1, in which case amortization payments of 1% per year of the outstanding principal as of the closing of the Securitization Notes are required. As of the most recent quarterly measurement date the consolidated leverage ratio exceeded 5.0:1 and, as a result, amortization payments are required. | |||
Senior Unsecured Notes [Member] | Senior Unsecured Notes Due January 2030 [Member] | ||||
Debt Instrument [Line Items] | ||||
Proceeds from Issuance of Debt | $ 800,000,000 | |||
Senior Unsecured Notes [Abstract] | ||||
Interest rate, stated (in hundredths) | 4.75% | |||
Frequency of interest payments | semiannually | |||
Debt Issuance Costs, Gross | $ 10,000,000 | |||
Senior Unsecured Notes [Member] | Subsidiary Senior Unsecured Notes [Member] | ||||
Short-term Borrowings | ||||
Senior Notes, Noncurrent | [3] | $ 2,850,000,000 | 2,850,000,000 | |
Senior Unsecured Notes [Abstract] | ||||
Issuance date | Jun. 16, 2016 | |||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Debt Instrument, Covenant Compliance | We were in compliance with all debt covenants as of December 31, 2019 | |||
Senior Unsecured Notes [Member] | Subsidiary Senior Unsecured Notes due 2024 [Member] | ||||
Senior Unsecured Notes [Abstract] | ||||
Maturity date | Jun. 1, 2024 | |||
Interest rate, effective (in hundredths) | [4] | 5.16% | ||
Senior Unsecured Notes [Member] | Subsidiary Senior Unsecured Notes due 2026 [Member] | ||||
Senior Unsecured Notes [Abstract] | ||||
Maturity date | Jun. 1, 2026 | |||
Interest rate, effective (in hundredths) | [4] | 5.39% | ||
Senior Unsecured Notes [Member] | Subsidiary Senior Unsecured Notes due 2027 [Member] | ||||
Senior Unsecured Notes [Abstract] | ||||
Maturity date | Jun. 1, 2027 | |||
Interest rate, effective (in hundredths) | [4] | 4.90% | ||
Senior Unsecured Notes [Member] | YUM Senior Unsecured Notes [Member] [Domain] | ||||
Short-term Borrowings | ||||
Senior Notes, Noncurrent | [3] | $ 2,425,000,000 | 1,875,000,000 | |
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Debt Instrument, Debt Default, Description of Violation or Event of Default | Our YUM Senior Unsecured Notes contain cross-default provisions whereby the acceleration of the maturity of any of our indebtedness in a principal amount in excess of $50 million will constitute a default under the YUM Senior Unsecured Notes unless such indebtedness is discharged, or the acceleration of the maturity of that indebtedness is annulled, within 30 days after notice | |||
London Interbank Offered Rate (LIBOR) [Member] | Secured Debt [Member] | Term Loan B Facility [Member] | ||||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Debt Instrument, Basis Spread on Variable Rate | 1.75% | |||
London Interbank Offered Rate (LIBOR) [Member] | Secured Debt [Member] | Term Loan A Facility and Revolving Facility [Member] | ||||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Debt Instrument, Basis Spread on Variable Rate | 1.50% | |||
Base Rate [Member] | Secured Debt [Member] | Term Loan B Facility [Member] | ||||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Debt Instrument, Basis Spread on Variable Rate | 0.75% | |||
Base Rate [Member] | Secured Debt [Member] | Term Loan A Facility and Revolving Facility [Member] | ||||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Debt Instrument, Basis Spread on Variable Rate | 0.50% | |||
Minimum [Member] | London Interbank Offered Rate (LIBOR) [Member] | Secured Debt [Member] | Term Loan A Facility and Revolving Facility [Member] | ||||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Debt Instrument, Basis Spread on Variable Rate | 1.25% | |||
Minimum [Member] | Base Rate [Member] | Secured Debt [Member] | Term Loan A Facility and Revolving Facility [Member] | ||||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Debt Instrument, Basis Spread on Variable Rate | 0.25% | |||
Maximum [Member] | London Interbank Offered Rate (LIBOR) [Member] | Secured Debt [Member] | Term Loan A Facility and Revolving Facility [Member] | ||||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Debt Instrument, Basis Spread on Variable Rate | 1.75% | |||
Maximum [Member] | Base Rate [Member] | Secured Debt [Member] | Term Loan A Facility and Revolving Facility [Member] | ||||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Debt Instrument, Basis Spread on Variable Rate | 0.75% | |||
Total Leverage Ratio [Member] | Secured Debt [Member] | the Credit Agreement [Member] | ||||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Debt Instrument, Covenant Description | require the Borrowers to maintain a total leverage ratio (defined as the ratio of Consolidated Total Debt to Consolidated EBITDA (as these terms are defined in the Credit Agreement)) of 5.0:1 or less | |||
Fixed Charge Coverage Ratio [Member] | Secured Debt [Member] | the Credit Agreement [Member] | ||||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Debt Instrument, Covenant Description | fixed charge coverage ratio (defined as the ratio of EBITDA minus capital expenditures to fixed charges (inclusive of rental expense and scheduled amortization)) of at least 1.5:1 | |||
Debt Service Coverage Ratio - Rapid Amortization Events [Member] | Secured Debt [Member] | Securitization Notes [Member] | ||||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Debt Instrument, Covenant Description | debt service coverage ratio (as defined in the related indenture) of at least 1.1:1 | |||
Debt Service Coverage Ratio - Cash Trap Reserve Account [Member] | Secured Debt [Member] | Securitization Notes [Member] | ||||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Debt Instrument, Covenant Description | debt service coverage ratio (or the ratio of Net Cash Flow to all debt service payments for the preceding four fiscal quarters) of at least 1.75:1 | |||
Debt Instrument, Covenant Compliance | During the most recent quarter ended December 31, 2019, the Securitization Entities maintained a debt service coverage ratio significantly in excess of the 1.75:1 requirement | |||
Prepaid Expenses and Other Current Assets [Member] | ||||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Restricted Cash and Cash Equivalents, Current | [6] | $ 138,000,000 | $ 151,000,000 | $ 60,000,000 |
Prepaid Expenses and Other Current Assets [Member] | Securitization Notes [Member] | ||||
Annual maturities of short-term borrowings and long-term debt excluding capital lease obligations and derivative instrument adjustments [Abstract] | ||||
Restricted Cash and Cash Equivalents, Current | 81,000,000 | |||
Letter of Credit [Member] | Revolving Credit Facility [Member] | ||||
Line of Credit Facility [Abstract] | ||||
Outstanding letters of credit | 1,300,000 | |||
2016 [Member] | Secured Debt [Member] | Class A-2-II Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt | $ 488,000,000 | |||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | May 11, 2016 | |||
Maturity date | May 25, 2023 | |||
Interest rate, stated (in hundredths) | 4.377% | |||
Interest rate, effective (in hundredths) | [7] | 4.59% | ||
2016 [Member] | Secured Debt [Member] | Class A-2-III Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt | $ 975,000,000 | |||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | May 11, 2016 | |||
Maturity date | May 25, 2026 | |||
Interest rate, stated (in hundredths) | 4.97% | |||
Interest rate, effective (in hundredths) | [7] | 5.14% | ||
2018 [Member] | Secured Debt [Member] | Class A-2-II Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt | $ 619,000,000 | |||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | Nov. 28, 2018 | |||
Maturity date | Nov. 25, 2028 | |||
Interest rate, stated (in hundredths) | 4.94% | |||
Interest rate, effective (in hundredths) | [7] | 5.06% | ||
2018 [Member] | Secured Debt [Member] | Class A-2 Notes [Member] | ||||
Senior Unsecured Notes [Abstract] | ||||
Maturity date | Nov. 1, 2048 | |||
2018 [Member] | Secured Debt [Member] | Class A-2-I Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt | $ 816,000,000 | |||
Senior Unsecured Notes [Abstract] | ||||
Issuance date | Nov. 28, 2018 | |||
Maturity date | Nov. 25, 2023 | |||
Interest rate, stated (in hundredths) | 4.318% | |||
Interest rate, effective (in hundredths) | [7] | 4.53% | ||
Termination of Master Services Agreement [Member] | GrubHub Inc. [Member] | ||||
Debt Instrument [Line Items] | ||||
Time period shares are restricted from being transferred | 30 days | |||
[1] | Amounts have not been allocated to any segment for performance reporting purposes. | |||
[2] | Includes the effects of the amortization of any (1) premium or discount; (2) debt issuance costs; and (3) gain or loss upon settlement of related treasury locks and forward starting interest rate swaps utilized to hedge the interest rate risk prior to debt issuance. | |||
[3] | We estimated the fair value of the YUM and Subsidiary Senior Unsecured Notes, Term Loan A Facility, and Term Loan B Facility using market quotes and calculations based on market rates. | |||
[4] | Includes the effects of the amortization of any discount and debt issuance costs as well as the impact of the interest rate swaps on the Term Loan B Facility (See Note 12). The effective rates related to our Term Loan A and B Facilities are based on current LIBOR-based interest rates at December 31, 2019. | |||
[5] | We estimated the fair value of the Securitization Notes by obtaining broker quotes from two separate brokerage firms that are knowledgeable about the Company’s Securitization Notes and, at times, trade these notes. The markets in which the Securitization Notes trade are not considered active markets. | |||
[6] | Restricted cash within Prepaid expenses and other current assets reflects Taco Bell Securitization interest reserves (See Note 10) and the cash related to advertising cooperatives that we consolidate that can only be used to settle obligations of the respective cooperatives. | |||
[7] | Includes the effects of the amortization of any discount and debt issuance costs. |
Leases (Details)
Leases (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Capital Leases, Future Minimum Payments, Present Value of Net Minimum Payments | $ 71 | $ 105 | ||
Operating Leases, Rent Expense | 151 | $ 214 | ||
Operating Lease, Right-of-Use Asset | [1] | $ 642 | 0 | |
Operating Lease, Payments | 104 | |||
Operating Lease, Cost | 115 | |||
Finance Lease, Right-of-Use Asset, Amortization | 3 | |||
Finance Lease, Interest Expense | 3 | |||
Finance Lease Cost | 6 | |||
Sublease Income | (69) | |||
Finance Lease, Interest Payment on Liability | 3 | |||
Finance Lease, Principal Payments | 4 | |||
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | 79 | |||
Right-of-Use Asset Obtained in Exchange for Finance Lease Liability | 14 | |||
Finance Lease, Right-of-Use Asset | 42 | |||
Lease Right of Use Asset | [2] | 684 | ||
Operating Lease, Liability, Current | 67 | 0 | ||
Finance Lease, Liability, Current | 7 | |||
Operating Lease, Liability, Noncurrent | 640 | |||
Finance Lease, Liability, Noncurrent | 70 | |||
Total Lease Liability | [2] | $ 784 | ||
Operating Lease, Weighted Average Remaining Lease Term | 12 years 3 months 19 days | |||
Operating Lease, Weighted Average Discount Rate, Percent | 5.60% | |||
Finance Lease, Weighted Average Discount Rate, Percent | 6.60% | |||
Operating Lease, Liability | $ 707 | |||
Finance Lease, Liability, Undiscounted Excess Amount | (33) | |||
Lessee, Operating Lease, Liability, Undiscounted Excess Amount | (280) | |||
Sales-type and Direct Financing Leases, Lease Receivable, Undiscounted Excess Amount | (18) | |||
Finance Lease, Liability | $ 77 | |||
Finance Lease, Weighted Average Remaining Lease Term | 12 years 8 months 15 days | |||
Capital Leases, Net Investment in Direct Financing Leases, Deferred Income | 19 | |||
Sales-type and Direct Financing Leases, Lease Receivable | $ 48 | 52 | ||
Operating Leases, Future Minimum Payments Receivable | 964 | 1,016 | ||
Operating Leases, Future Minimum Payments Receivable | 46 | |||
Capital Leases, Net Investment in Direct Financing Leases, Minimum Payments to be Received | 30 | |||
Capital leases, future minimum commitments [Abstract] | ||||
2016 | 11 | 10 | ||
2017 | 11 | 10 | ||
2018 | 9 | 9 | ||
2019 | 9 | 8 | ||
2020 | 8 | 8 | ||
Thereafter | 62 | 58 | ||
Capital leases, total future minimum commitments | 110 | 103 | ||
Operating leases, future minimum commitments [Abstract] | ||||
2016 | 105 | 103 | ||
2017 | 100 | 89 | ||
2018 | 92 | 78 | ||
2019 | 83 | 71 | ||
2020 | 76 | 61 | ||
Thereafter | 531 | 384 | ||
Operating leases, total future minimum commitments | 987 | 786 | ||
Sales-type and Direct Financing Leases, Lease Receivable, Lease Payments to be Received, after Rolling Year Five | 28 | 30 | ||
Lessor, Operating Lease, Payments to be Received, Thereafter | 601 | 638 | ||
Sales-type and Direct Financing Leases, Lease Receivable, Payments to be Received, Five Years | 3 | 3 | ||
Lessor, Operating Lease, Payments to be Received, Five Years | 65 | 67 | ||
Sales-type and Direct Financing Leases, Lease Receivable, Payments to be Received, Four Years | 4 | 4 | ||
Lessor, Operating Lease, Payments to be Received, Four Years | 69 | 69 | ||
Sales-type and Direct Financing Leases, Lease Receivable, Lease Payments to be Received, Rolling Year Three | 4 | 4 | ||
Lessor, Operating Lease, Payments to be Received, Three Years | 72 | 74 | ||
Sales-type and Direct Financing Leases, Lease Receivable, Lease Payments to be Received, Rolling Year Two | 4 | 5 | ||
Direct Financing Lease, Lease Receivable | 5 | 6 | ||
Lessor, Operating Lease, Payments to be Received, Next Twelve Months | 81 | 89 | ||
Operating Leases, Future Minimum Payments Receivable, in Two Years | 76 | $ 79 | ||
United States | ||||
Operating Lease, Right-of-Use Asset | 283 | |||
Operating Lease, Liability | $ 337 | |||
[1] | (b) Increase from 2018 primarily due to the adoption of Topic 842 beginning with the year ended December 31, 2019. See Notes 2 and 4 for further discussion. | |||
[2] | (a) U.S. operating lease right-of-use assets and liabilities totaled $283 million and $337 million |
Derivative Instruments (Details
Derivative Instruments (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||
Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Aug. 22, 2019 | ||
Term Loan B Facility [Member] | ||||||
Long-term Debt | $ 1,935 | |||||
Secured Debt [Member] | Term Loan B Facility [Member] | ||||||
Long-term Debt | [1] | 1,935 | $ 1,955 | |||
Cross Currency Interest Rate Contract [Member] | ||||||
Derivative, Cash Received on Hedge | $ 3 | |||||
Cash Flow Hedging [Member] | ||||||
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | 6 | |||||
Cash Flow Hedging [Member] | Foreign Exchange Contract [Member] | ||||||
Derivative, Notional Amount | 20 | 459 | ||||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | $ (8) | (20) | $ 56 | |||
Cash Flow Hedging [Member] | Interest Rate Swap [Member] | ||||||
Derivative, Maturity Date | Jul. 27, 2021 | |||||
Derivative, Notional Amount | $ 1,550 | |||||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | $ (17) | $ (19) | $ 2 | |||
Cash Flow Hedging [Member] | Forward-starting interest rate swap [Member] | ||||||
Derivative, Maturity Date | Mar. 1, 2025 | |||||
Derivative, Notional Amount | $ 1,500 | |||||
Cash Flow Hedging [Member] | Cross Currency Interest Rate Contract [Member] | ||||||
Derivative, Notional Amount | $ 430 | |||||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | $ 4 | |||||
Maximum [Member] | Cash Flow Hedging [Member] | Foreign Exchange Contract [Member] | ||||||
Derivative, Maturity Date | Jun. 12, 2020 | |||||
Minimum [Member] | Cash Flow Hedging [Member] | Foreign Exchange Contract [Member] | ||||||
Derivative, Maturity Date | Feb. 23, 2019 | |||||
July 2021 through March 2025 [Member] | Fixed Income Interest Rate [Member] | Cash Flow Hedging [Member] | Interest Rate Swap [Member] | ||||||
Derivative, Forward Interest Rate | 4.81% | |||||
[1] | We estimated the fair value of the YUM and Subsidiary Senior Unsecured Notes, Term Loan A Facility, and Term Loan B Facility using market quotes and calculations based on market rates. |
Derivative Instruments (Detai_2
Derivative Instruments (Details 2) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, before Tax | $ (51) | $ 19 | $ (52) |
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Tax | (20) | (6) | 2 |
Cash Flow Hedging [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | 6 | ||
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, Tax | 16 | 1 | 1 |
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Tax | $ (4) | (5) | 3 |
Interest Rate Swap [Member] | Cash Flow Hedging [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative, Maturity Date | Jul. 27, 2021 | ||
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, before Tax | $ (71) | (3) | 4 |
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | (17) | (19) | 2 |
Foreign Exchange Contract [Member] | Cash Flow Hedging [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, before Tax | 20 | 22 | (56) |
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | $ (8) | $ (20) | $ 56 |
Maximum [Member] | Foreign Exchange Contract [Member] | Cash Flow Hedging [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative, Maturity Date | Jun. 12, 2020 |
Fair Value Disclosures (Details
Fair Value Disclosures (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | ||
Non-recurring basis | Fair Value, Inputs, Level 3 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Refranchise Impairment | $ 7 | ||
Non-recurring basis | Fair Value, Inputs, Level 3 [Member] | Closures and impairment (income) expenses | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total losses related to long-lived assets held for use and measured at fair value on a non-recurring basis | 4 | $ 1 | |
Other Assets [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Interest Rate Swap [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative Liability, Fair Value, Gross Asset | 3 | 29 | |
Other Assets [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investments, Fair Value Disclosure | 43 | 27 | |
Other Noncurrent Liabilities [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Foreign Exchange Forward [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative Liability, Fair Value, Gross Liability | 0 | 24 | |
Other Noncurrent Liabilities [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Interest Rate Swap [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative Liability, Fair Value, Gross Liability | 71 | 23 | |
Prepaid Expenses and Other Current Assets [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Foreign Exchange Forward [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative Liability, Fair Value, Gross Asset | 0 | 5 | |
Prepaid Expenses and Other Current Assets [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Interest Rate Swap [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative Liability, Fair Value, Gross Asset | 6 | 21 | |
Term Loan A Facility [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Long-term Debt | 463 | ||
Term Loan B Facility [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Long-term Debt | 1,935 | ||
Unsecured Debt [Member] | Subsidiary Senior Unsecured Notes [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Senior Notes, Noncurrent | [1] | 2,850 | 2,850 |
Unsecured Debt [Member] | Subsidiary Senior Unsecured Notes [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Long-term Debt, Fair Value | [1] | 3,004 | 2,733 |
Unsecured Debt [Member] | YUM Senior Unsecured Notes [Member] [Domain] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Senior Notes, Noncurrent | [1] | 2,425 | 1,875 |
Unsecured Debt [Member] | YUM Senior Unsecured Notes [Member] [Domain] | Fair Value, Inputs, Level 2 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Long-term Debt, Fair Value | [1] | 2,572 | 1,798 |
Secured Debt [Member] | Securitization Notes [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Senior Notes, Noncurrent | [2] | 2,898 | 2,928 |
Secured Debt [Member] | Securitization Notes [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Long-term Debt, Fair Value | [2] | 3,040 | 2,967 |
Secured Debt [Member] | Term Loan A Facility [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Long-term Debt | [1] | 463 | 488 |
Secured Debt [Member] | Term Loan A Facility [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Long-term Debt, Fair Value | [1] | 464 | 479 |
Secured Debt [Member] | Term Loan B Facility [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Long-term Debt | [1] | 1,935 | 1,955 |
Secured Debt [Member] | Term Loan B Facility [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Long-term Debt, Fair Value | [1] | 1,949 | 1,915 |
GrubHub Inc. [Member] | Other Assets [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Equity Securities, FV-NI | [3] | $ 137 | $ 214 |
[1] | We estimated the fair value of the YUM and Subsidiary Senior Unsecured Notes, Term Loan A Facility, and Term Loan B Facility using market quotes and calculations based on market rates. | ||
[2] | We estimated the fair value of the Securitization Notes by obtaining broker quotes from two separate brokerage firms that are knowledgeable about the Company’s Securitization Notes and, at times, trade these notes. The markets in which the Securitization Notes trade are not considered active markets. | ||
[3] | (c) Refer to Note 4 for additional discussion regarding our investment in Grubhub. |
Pension, Retiree Medical and _3
Pension, Retiree Medical and Retiree Savings Plans (Details) - USD ($) $ in Millions | 12 Months Ended | |||||||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |||
Defined Benefit Plan Disclosure [Line Items] | ||||||||||
Contributions to defined benefit pension plans | $ (15) | $ (16) | $ (55) | |||||||
Components of net periodic benefit cost: | ||||||||||
Amortization of prior service cost | 5 | 5 | ||||||||
Amortization of net loss | (2) | (17) | ||||||||
Pension losses in accumulated other comprehensive income (loss): | ||||||||||
Unrealized gains (losses) arising during the year | $ (39) | 32 | (17) | |||||||
Assumed health care cost trend rates [Abstract] | ||||||||||
Year that rate reaches ultimate trend rate | 2038 | |||||||||
Effect of one-percentage point change in assumed health care cost trend rates [Abstract] | ||||||||||
Maximum 401(k) participant contribution of eligible compensation | 75.00% | |||||||||
Company match of participant contribution up to 6% of eligible compensation | 100.00% | |||||||||
Maximum company match of participant contribution of eligible compensation | 6.00% | |||||||||
Defined Contribution Plan, Cost | $ 11 | 12 | 13 | |||||||
Pension settlement charges | (3) | |||||||||
Foreign Pension Plan [Member] | ||||||||||
Change in benefit obligation | ||||||||||
Benefit obligation at beginning of year | 233 | |||||||||
Benefit obligation at end of year | 290 | 233 | ||||||||
Change in plan assets | ||||||||||
Fair value of plan assets at beginning of year | 319 | |||||||||
Fair value of plan assets at end of year | 372 | 319 | ||||||||
Plan Assets [Abstract] | ||||||||||
Fair value of plan assets by asset category | 319 | 319 | $ 372 | $ 319 | ||||||
United States | ||||||||||
Defined Benefit Plan Disclosure [Line Items] | ||||||||||
Net Payable For Unsettled Transactions | 169 | 41 | ||||||||
Pension data adjustment | [1] | 0 | 0 | 22 | ||||||
Defined Benefit Plan, Benefit Obligation, Benefits Paid | (57) | (73) | ||||||||
Change in benefit obligation | ||||||||||
Benefit obligation at beginning of year | 873 | 1,007 | ||||||||
Service cost | 6 | 8 | 10 | |||||||
Interest cost | 39 | 38 | 41 | |||||||
Plan amendments | 2 | 1 | ||||||||
Curtailment | 0 | 0 | ||||||||
Special termination benefits | 0 | 1 | 2 | |||||||
Settlement payments | 1 | 0 | ||||||||
Actuarial (gain) loss | 153 | (109) | ||||||||
Defined Benefit Plan, Plan Assets, Administration Expense | 0 | 0 | ||||||||
Benefit obligation at end of year | 1,015 | 873 | 1,007 | |||||||
Change in plan assets | ||||||||||
Fair value of plan assets at beginning of year | 755 | 864 | ||||||||
Actual return on plan assets | 176 | (49) | ||||||||
Employer contributions | 12 | 13 | ||||||||
Settlement payments | 0 | 0 | ||||||||
Fair value of plan assets at end of year | 886 | 755 | 864 | |||||||
Defined Benefit Plan, Plan Assets, Benefits Paid | (57) | (73) | ||||||||
Funded status at end of year | (129) | (118) | ||||||||
Benefit Payments [Abstract] | ||||||||||
2016 | 43 | |||||||||
2017 | 47 | |||||||||
2018 | 49 | |||||||||
2019 | 52 | |||||||||
2020 | 53 | |||||||||
2021 - 2025 | 287 | |||||||||
Amounts recognized in the Consolidated Balance Sheet: | ||||||||||
Accrued benefit liability - current | (4) | (5) | ||||||||
Accrued benefit liability - non-current | (125) | (113) | ||||||||
Accrued benefit amounts recognized | (129) | (118) | ||||||||
Amounts recognized as a loss in Accumulated Other Comprehensive Income: | ||||||||||
Actuarial net gain | 118 | 101 | ||||||||
Prior service cost | (18) | (22) | ||||||||
Amounts recognized as a loss in Accumulated Other Comprehensive Income | (123) | (123) | (160) | (136) | (123) | $ (160) | ||||
Accumulated benefit obligation | 984 | 849 | ||||||||
Information for pension plans with an accumulated benefit obligation in excess of plan assets: | ||||||||||
Projected benefit obligation | 1,015 | 873 | ||||||||
Accumulated benefit obligation | 984 | 849 | ||||||||
Fair value of plan assets | 886 | 755 | ||||||||
Information for pension plans with a projected benefit obligation in excess of plan assets: | ||||||||||
Defined Benefit Plan, Pension Plan with Projected Benefit Obligation in Excess of Plan Assets, Projected Benefit Obligation | 1,015 | 873 | ||||||||
Accumulated benefit obligation | 984 | 849 | ||||||||
Defined Benefit Plan, Pension Plan with Projected Benefit Obligation in Excess of Plan Assets, Plan Assets | 886 | 755 | ||||||||
Components of net periodic benefit cost: | ||||||||||
Service cost | 6 | 8 | 10 | |||||||
Interest cost | 39 | 38 | 41 | |||||||
Amortization of prior service cost | [2] | 6 | 5 | 6 | ||||||
Expected return on plan assets | 44 | 44 | 45 | |||||||
Amortization of net loss | (1) | (16) | (5) | |||||||
Net periodic benefit cost | 8 | 23 | 17 | |||||||
Additional loss recognized due to: | ||||||||||
Special termination benefits | 0 | 1 | 2 | |||||||
Pension losses in accumulated other comprehensive income (loss): | ||||||||||
Beginning of year | (123) | (160) | ||||||||
Unrealized gains (losses) arising during the year | (22) | 17 | ||||||||
Other Comprehensive Income (Loss),Defined Benefit Plans, Curtailment Gain (Loss), before Tax | 0 | 0 | ||||||||
Curtailment gain | 4 | 0 | ||||||||
Amortization of net loss | 1 | 16 | ||||||||
Amortization of prior service cost | 6 | 5 | ||||||||
Prior service cost | (2) | (1) | ||||||||
End of year | $ (136) | $ (123) | $ (160) | |||||||
Weighted-average assumptions used to determine benefit obligations at the measurement dates: | ||||||||||
Discount rate (in hundredths) | 3.50% | 4.60% | 3.50% | 4.60% | 3.90% | |||||
Rate of compensation increase (in hundredths) | 3.00% | 3.00% | ||||||||
Weighted-average assumptions used to determine the net periodic benefit cost for fiscal years: | ||||||||||
Discount rate (in hundredths) | 4.60% | 3.90% | 4.53% | [3] | ||||||
Long-term rate return on plan assets (in hundredths) | 5.75% | 5.65% | 6.06% | [3] | ||||||
Rate of compensation increase (in hundredths) | 3.00% | 3.75% | 3.75% | [3] | ||||||
Plan Assets [Abstract] | ||||||||||
Fair value of plan assets by asset category | $ 886 | $ 864 | $ 864 | 886 | 755 | $ 864 | ||||
Equity securities, target allocation (in hundredths) | 50.00% | |||||||||
Value of mutual fund held as an investment that includes YUM stock | 0.3 | 0.3 | ||||||||
Approximate percentage of total plan assets in investment that includes YUM stock (in hundredths) | 1.00% | 1.00% | ||||||||
Effect of one-percentage point change in assumed health care cost trend rates [Abstract] | ||||||||||
Defined Benefit Plan, Expected Future Employer Contributions, Next Fiscal Year | 0 | |||||||||
Pension settlement charges | [4] | $ (3) | $ 0 | (19) | ||||||
United States | Fair Value, Inputs, Level 1 [Member] | Cash [Member] | ||||||||||
Change in plan assets | ||||||||||
Fair value of plan assets at beginning of year | 3 | |||||||||
Fair value of plan assets at end of year | 5 | 3 | ||||||||
Plan Assets [Abstract] | ||||||||||
Fair value of plan assets by asset category | 3 | 3 | 5 | 3 | ||||||
United States | Fair Value, Inputs, Level 1 [Member] | Cash Equivalents [Member] | ||||||||||
Change in plan assets | ||||||||||
Fair value of plan assets at beginning of year | [5] | 10 | ||||||||
Fair value of plan assets at end of year | [5] | 13 | 10 | |||||||
Plan Assets [Abstract] | ||||||||||
Fair value of plan assets by asset category | [5] | 10 | 10 | 13 | 10 | |||||
United States | Fair Value, Inputs, Level 1 [Member] | Equity Securities - US Large cap [Member] | ||||||||||
Change in plan assets | ||||||||||
Fair value of plan assets at beginning of year | [6] | 215 | ||||||||
Fair value of plan assets at end of year | [6] | 268 | 215 | |||||||
Plan Assets [Abstract] | ||||||||||
Fair value of plan assets by asset category | [6] | 215 | 215 | 268 | 215 | |||||
United States | Fair Value, Inputs, Level 1 [Member] | Debt Security, Corporate, US [Member] | ||||||||||
Change in plan assets | ||||||||||
Fair value of plan assets at beginning of year | [6] | 140 | ||||||||
Fair value of plan assets at end of year | [6] | 161 | 140 | |||||||
Plan Assets [Abstract] | ||||||||||
Fair value of plan assets by asset category | [6] | 140 | 140 | 161 | 140 | |||||
United States | Fair Value, Inputs, Level 1 [Member] | Equity Securities - US Mid cap [Member] | ||||||||||
Change in plan assets | ||||||||||
Fair value of plan assets at beginning of year | [6] | 35 | ||||||||
Fair value of plan assets at end of year | [6] | 44 | 35 | |||||||
Plan Assets [Abstract] | ||||||||||
Fair value of plan assets by asset category | [6] | 35 | 35 | 44 | 35 | |||||
United States | Fair Value, Inputs, Level 1 [Member] | Equity Securities - US Small cap [Member] | ||||||||||
Change in plan assets | ||||||||||
Fair value of plan assets at beginning of year | [6] | 34 | ||||||||
Fair value of plan assets at end of year | [6] | 43 | 34 | |||||||
Plan Assets [Abstract] | ||||||||||
Fair value of plan assets by asset category | [6] | 34 | 34 | 43 | 34 | |||||
United States | Fair Value, Inputs, Level 2 [Member] | Debt Security, Corporate, US [Member] | ||||||||||
Change in plan assets | ||||||||||
Fair value of plan assets at beginning of year | [7] | 106 | ||||||||
Fair value of plan assets at end of year | [7] | 120 | 106 | |||||||
Plan Assets [Abstract] | ||||||||||
Fair value of plan assets by asset category | [7] | 106 | 106 | 120 | 106 | |||||
United States | Fair Value, Inputs, Level 2 [Member] | US Treasury and Government [Member] | ||||||||||
Change in plan assets | ||||||||||
Fair value of plan assets at beginning of year | [8] | 161 | ||||||||
Fair value of plan assets at end of year | [8] | 274 | 161 | |||||||
Plan Assets [Abstract] | ||||||||||
Fair value of plan assets by asset category | [8] | 161 | 161 | 274 | 161 | |||||
United States | Fair Value, Inputs, Level 2 [Member] | Fixed Income Securities [Member] | ||||||||||
Change in plan assets | ||||||||||
Fair value of plan assets at beginning of year | [8] | 18 | ||||||||
Fair value of plan assets at end of year | [8] | 39 | 18 | |||||||
Plan Assets [Abstract] | ||||||||||
Fair value of plan assets by asset category | [8] | 18 | 18 | 39 | 18 | |||||
United States | Fair value of plan assets, amount settled prior to year end [Member] | ||||||||||
Change in plan assets | ||||||||||
Fair value of plan assets at beginning of year | [9] | 796 | ||||||||
Fair value of plan assets at end of year | [9] | 1,055 | 796 | |||||||
Plan Assets [Abstract] | ||||||||||
Fair value of plan assets by asset category | [9] | 796 | 796 | 1,055 | 796 | |||||
Non-US [Member] | Fair Value, Inputs, Level 1 [Member] | Equity Securities - Non US [Member] | ||||||||||
Change in plan assets | ||||||||||
Fair value of plan assets at beginning of year | [6] | 74 | ||||||||
Fair value of plan assets at end of year | [6] | 88 | 74 | |||||||
Plan Assets [Abstract] | ||||||||||
Fair value of plan assets by asset category | [6] | 74 | 74 | 88 | 74 | |||||
Other pension (income) expense [Member] | United States | ||||||||||
Defined Benefit Plan Disclosure [Line Items] | ||||||||||
Pension data adjustment | 22 | |||||||||
Other Postretirement Benefits Plan [Member] | ||||||||||
Benefit Payments [Abstract] | ||||||||||
2016 | 4 | |||||||||
2017 | 4 | |||||||||
2018 | 4 | |||||||||
2019 | 4 | |||||||||
2020 | 4 | |||||||||
2021 - 2025 | 14 | |||||||||
Amounts recognized as a loss in Accumulated Other Comprehensive Income: | ||||||||||
Actuarial net gain | (9) | (13) | ||||||||
Accumulated benefit obligation | $ 44 | $ 45 | ||||||||
Components of net periodic benefit cost: | ||||||||||
Net periodic benefit cost | $ 1 | $ 2 | $ 2 | |||||||
[1] | Reflects a non-cash, out-of-year charge related to the adjustment of certain historical deferred vested liability balances in the Plan during the first quarter of 2017 recorded in Other pension (income) expense. See Note 4. | |||||||||
[2] | Prior service costs are amortized on a straight-line basis over the average remaining service period of employees expected to receive benefits. | |||||||||
[3] | (a) Reflects a weighted average due to interim re-measurements in 2017. | |||||||||
[4] | Settlement losses result when benefit payments exceed the sum of the service cost and interest cost within a plan during the year. These losses were recorded in Other pension (income) expense. | |||||||||
[5] | Short-term investments in money market funds. | |||||||||
[6] | Securities held in common trusts. | |||||||||
[7] | Investments held directly by the Plan. | |||||||||
[8] | Includes securities held in common trusts and investments held directly by the Plan. | |||||||||
[9] | (e) 2019 and 2018 exclude net unsettled trade payables of $169 million and $41 million , respectively. |
Share-based and Deferred Comp_3
Share-based and Deferred Compensation Plans (Details) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended | |||||
Dec. 31, 2019USD ($)groups$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based Compensation Expense | $ 59 | $ 50 | [1] | $ 65 | [1] | |
Award Valuation | ||||||
Risk-free interest rate (in hundredths) | 2.50% | 2.50% | 1.90% | |||
Expected term (years) | 6 years 6 months | 6 years 6 months | 6 years 5 months | |||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate | 22.00% | 22.00% | 22.90% | |||
Expected dividend yield (in hundredths) | 1.80% | 1.80% | 1.80% | |||
Number of homogeneous groups appropriate to group awards into when estimating expected term | groups | 2 | |||||
Summary of award activity - Stock options and SARs, additional disclosures [Abstract] | ||||||
Options outstanding at the end of the year (in shares) | shares | 782 | |||||
SARs outstanding at the end of the year (in shares) | shares | 14,082 | |||||
Options outstanding at the end of the year, Weighted-average exercise price (in dollars per share) | $ / shares | $ 45.03 | |||||
SARs outstanding at the end of the year, Weighted-average exercise price (in dollars per share) | $ / shares | $ 61.64 | |||||
Impact on net income [Abstract] | ||||||
Share-based Payment Arrangement, Expense, Tax Benefit | $ 9 | $ 9 | $ 22 | [2] | ||
EID compensation expense not share-based | 17 | (2) | 12 | |||
Cash received from stock options exercises | 1 | 5.5 | 12 | |||
Share-based Payment Arrangement, Exercise of Option, Tax Benefit | 66 | 60 | 153 | |||
General and administrative expenses | 917 | 895 | 999 | |||
Stock Options and Stock Appreciation Rights [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based Compensation Expense | $ 39 | 37 | 30 | |||
Minimum vesting period of outstanding awards (in years) | P1Y8M13D | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | $ 31 | $ 28 | $ 33 | |||
Summary of award activity - Stock options and SARs [Roll Forward] | ||||||
Granted (in shares) | shares | 2,332 | |||||
Exercised (in shares) | shares | (3,210) | |||||
Forfeited or expired (in shares) | shares | (449) | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period, Weighted Average Exercise Price | $ / shares | $ 75.29 | |||||
Summary of award activity - Stock options and SARs, additional disclosures [Abstract] | ||||||
Granted, Weighted-average exercise price (in dollars per share) | $ / shares | 93.52 | |||||
Exercised, Weighted-average exercise price (in dollars per share) | $ / shares | $ 38.16 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value | $ 594 | |||||
Exercisable at the end of the year (in shares) | shares | 9,283 | |||||
Exercisable at the end of the year, Weighted-average exercise price (in dollars per share) | $ / shares | $ 49.38 | |||||
Share Based Compensation Arrangement By Share Based Payment Award, Options, Exercisable Weighted Average Remaining Contractual Term | 4 years 1 month 7 days | |||||
Exercisable at the end of the year, Aggregate intrinsic value (in dollars) | $ 477 | |||||
Options outstanding at the end of the year (in shares) | shares | 14,864 | [3] | 16,191 | |||
Options outstanding at the end of the year, Weighted-average exercise price (in dollars per share) | $ / shares | $ 60.76 | $ 51.84 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term | 5 years 7 months 14 days | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | $ / shares | $ 19.82 | $ 16.45 | $ 14.08 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | $ 204 | $ 195 | $ 154 | |||
Unrecognized compensation cost | 49 | |||||
Performance Share Units [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based Compensation Expense | 8 | 7 | 9 | |||
Restricted Stock Units (RSUs) [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based Compensation Expense | 12 | 6 | 26 | |||
Restricted Stock Units And Performance Share Units [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | 14 | 16 | 10 | |||
Summary of award activity - Stock options and SARs, additional disclosures [Abstract] | ||||||
Unrecognized compensation cost | $ 30 | |||||
Unvested RSUs and PSUs | shares | 1,100 | |||||
Long Term Incentive Plans [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Minimum vesting period of outstanding awards (in years) | immediate | |||||
Maximum vesting period of outstanding awards (in years) | 5 years | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | |||||
Approximate number of shares available for grant (in shares) | shares | 26,000 | |||||
Executive Income Deferral Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Percentage of Company match on amount deferred (in hundredths) | 33.00% | |||||
Executive Income Deferral Plan [Member] | Restricted Stock Units (RSUs) [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period (in years) | 2 years | |||||
Mark-to-Market of YUM China Funds [Member] | Executive Income Deferral Plan [Member] | ||||||
Impact on net income [Abstract] | ||||||
General and administrative expenses | $ 3 | $ 18 | $ 18 | |||
Restaurant-level Employees [Domain] | Long Term Incentive Plans [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Average Exercise Period | 5 years | |||||
Vesting period (in years) | 4 years | |||||
Executives [Domain] | Long Term Incentive Plans [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Average Exercise Period | 6 years 6 months | |||||
Vesting period (in years) | 4 years | |||||
Award Valuation | ||||||
Graded vesting schedule of grants made to executives under other stock award plans | 25% | |||||
[1] | Includes $3 million of appreciation and $18 million of depreciation in the market price of Yum China's stock in 2018 and 2017, respectively. See Note 4. | |||||
[2] | Deferred tax benefit recognized does not reflect the impact of the Tax Act. See Note 17. | |||||
[3] | Outstanding awards include 782 options and 14,082 SARs with weighted average exercise prices of $45.03 and $61.64 , respectively. Outstanding awards represent YUM awards held by employees of both YUM and Yum China. |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - USD ($) shares in Thousands | 12 Months Ended | 24 Months Ended | |||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2019 | ||||
Repurchase Of Shares Of Common Stock [Line Items] | |||||||
Value of share repurchases with trade dates during the current reporting date but with settlement dates subsequent to the current reporting date. | $ 45,000,000 | $ 5,000,000 | |||||
Number of shares repurchased with trade dates during the current reporting date but with settlement dates subsequent to the current reporting date. | 700 | 100 | |||||
Stock Repurchased During Period, Shares | 7,788 | [1] | 28,243 | [1] | 26,561 | [2] | |
Stock Repurchased During Period, Value | $ 810,000,000 | [1] | $ 2,394,000,000 | [1] | $ 1,915,000,000 | [2] | |
November 2017 [Member] | |||||||
Repurchase Of Shares Of Common Stock [Line Items] | |||||||
Stock Repurchased During Period, Shares | 0 | 18,240 | 0 | ||||
Stock Repurchased During Period, Value | $ 0 | $ 1,500,000,000 | $ 0 | ||||
November 2016 [Member] | |||||||
Repurchase Of Shares Of Common Stock [Line Items] | |||||||
Stock Repurchased During Period, Shares | 0 | 0 | 26,561 | ||||
Stock Repurchased During Period, Value | $ 0 | $ 0 | $ 1,915,000,000 | ||||
August 2018 [Member] | |||||||
Repurchase Of Shares Of Common Stock [Line Items] | |||||||
Stock Repurchased During Period, Shares | 7,788 | 10,003 | 0 | ||||
Stock Repurchased During Period, Value | $ 810,000,000 | $ 894,000,000 | $ 0 | ||||
November 2019 [Member] | |||||||
Repurchase Of Shares Of Common Stock [Line Items] | |||||||
Stock Repurchase Program, Authorized Amount | 2,000,000,000 | $ 2,000,000,000 | |||||
Stock Repurchase Program, Remaining Authorized Repurchase Amount | 2,000,000,000 | 2,000,000,000 | |||||
August 2018 [Member] | |||||||
Repurchase Of Shares Of Common Stock [Line Items] | |||||||
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ 296,000,000 | $ 296,000,000 | |||||
[1] | 2019 amount excludes and 2018 amount includes the effect of $5 million in share repurchases ( 0.1 million shares) with trade dates on, or prior to, December 31, 2018 but settlement dates subsequent to December 31, 2018. | ||||||
[2] | 2017 amount excludes the effect of $45 million in share repurchases ( 0.7 million shares) with trade dates prior to December 31, 2016 but settlement dates subsequent to December 31, 2016. |
Shareholders' Equity (Details 2
Shareholders' Equity (Details 2) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | $ 2 | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax, Beginning Balance | $ (334) | |||
OCI, net of tax | (54) | (65) | $ 187 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax, Ending Balance | (388) | (334) | ||
Defined Benefit Plan, Amortization of Gain (Loss) | (2) | (17) | ||
Pension settlement charges | (3) | |||
Defined Benefit Plan, Amortization of Prior Service Cost (Credit) | 5 | 5 | ||
Tax (expense) benefit on reclassification of pension and post-retirement losses to net income | 2 | 5 | ||
Translation Adjustment and Gains (Losses) From Intra-Entity Transactions of a Long-Term Nature | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | [1],[2] | 21 | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax, Beginning Balance | [2] | (245) | (174) | |
Amounts classified into OCI, net of tax | [2] | 24 | (88) | |
Amounts reclassified from accumulated OCI, net of tax | [2] | 0 | (4) | |
OCI, net of tax | [2] | 24 | (92) | |
Accumulated Other Comprehensive Income (Loss), Net of Tax, Ending Balance | [2] | (221) | (245) | (174) |
Pension and Post-Retirement Benefit Plan Losses | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | [3],[4] | (17) | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax, Beginning Balance | [4] | (82) | (106) | |
Amounts classified into OCI, net of tax | [4] | (30) | 24 | |
Amounts reclassified from accumulated OCI, net of tax | [4] | 8 | 17 | |
OCI, net of tax | [4] | (22) | 41 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax, Ending Balance | [4] | (104) | (82) | (106) |
Net Unrealized Loss on Derivative Instruments | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | [3],[5] | (2) | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax, Beginning Balance | [5] | (7) | 9 | |
Amounts classified into OCI, net of tax | [5] | (35) | 20 | |
Amounts reclassified from accumulated OCI, net of tax | [5] | (21) | (34) | |
OCI, net of tax | [5] | (56) | (14) | |
Accumulated Other Comprehensive Income (Loss), Net of Tax, Ending Balance | [5] | (63) | (7) | 9 |
Total | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax, Beginning Balance | (334) | (271) | ||
Amounts classified into OCI, net of tax | (41) | (44) | ||
Amounts reclassified from accumulated OCI, net of tax | (13) | (21) | ||
OCI, net of tax | (54) | (65) | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax, Ending Balance | $ (388) | $ (334) | $ (271) | |
[1] | Represents the impact of foreign currency translation from the adoption of Topic 606. See Notes 2 and 4. | |||
[2] | Amounts reclassified from AOCI are due to substantially complete liquidations of foreign entities related to the KFC and Pizza Hut Brazil refranchising transactions during 2018. | |||
[3] | During the quarter ended March 31, 2018, we adopted a standard that allowed for the reclassification from AOCI to Accumulated deficit for stranded tax effects resulting from the Tax Act. | |||
[4] | Amounts reclassified from AOCI for pension and post-retirement benefit plans losses during 2019 include amortization of net losses of $2 million , amortization of prior service cost of $5 million , settlement charges of $3 million and related income tax benefit of $2 million . Amounts reclassified from AOCI for pension and post-retirement benefit plan losses during 2018 include amortization of net losses of $17 million , amortization of prior service cost of $5 million and related income tax benefit of $5 million . See Note 14. | |||
[5] | See Note 12 for details on amounts reclassified from AOCI. |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 12 Months Ended | |||||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2017 | ||
Valuation Allowance [Line Items] | ||||||||
Tax Credit Carryforward, Valuation Allowance | $ 200 | $ 111 | $ 111 | $ 111 | $ 189 | $ 189 | $ 189 | |
Deferred Tax Assets, Net of Valuation Allowance, Current | $ 447 | $ 195 | 195 | $ 195 | ||||
Effective income tax rate reconciliation [Abstract] | ||||||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | 21.00% | 21.00% | 35.00% | 21.00% | |||
State income tax, net of federal tax benefit (in hundredths) | 0.80% | 1.00% | 0.50% | |||||
Statutory rate differential attributable to foreign operations (in hundredths) | 1.60% | (12.30%) | (9.30%) | |||||
Effective Income Tax Rate Reconciliation Adjustments To Reserves And Prior Years | 4.20% | 2.80% | 0.50% | |||||
Change in valuation allowance (in hundredths) | (2.60%) | 8.50% | 1.50% | |||||
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Restructuring Charges, Percent | (16.10%) | 0.00% | 0.00% | |||||
Effective Income Tax Rate Reconciliation, Tax Cuts and Jobs Act, Percent | 0 | (0.019) | 0.191 | |||||
Other, net (in hundredths) | 0.80% | (0.40%) | (1.10%) | |||||
Effective income tax rate (in hundredths) | 5.70% | 16.20% | 41.10% | |||||
Share-based Payment Arrangement, Expense, Tax Benefit | $ (9) | (9) | (22) | [1] | ||||
Effective Income Tax Rate Reconciliation Share Based Compensation | (4.00%) | (2.50%) | (5.10%) | |||||
Income Tax Expense (Benefit), Continuing Operations, Income Tax Reconciliation [Abstract] | ||||||||
Effective income tax rate | $ 79 | 297 | 934 | |||||
Details of income tax provision (benefit) [Abstract] | ||||||||
Current: Federal | 129 | 102 | (2) | |||||
Current: Foreign | 166 | 181 | 290 | |||||
Current: State | 16 | 25 | 12 | |||||
Total current income tax provision (benefit) | 311 | 308 | 300 | |||||
Deferred: Federal | (16) | (24) | 603 | |||||
Deferred: Foreign | (213) | 5 | 19 | |||||
Deferred: State | (3) | 8 | 12 | |||||
Total deferred income tax provision (benefit) | (232) | (11) | 634 | |||||
Effective income tax rate | 79 | 297 | 934 | |||||
U.S. and foreign income before income taxes [Abstract] | ||||||||
U.S. | 466 | 726 | 662 | |||||
Foreign | 907 | 1,113 | 1,612 | |||||
Income from Continuing Operations Before Income Taxes | 1,373 | 1,839 | 2,274 | |||||
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Amount | $ 35 | $ 434 | ||||||
State and Local Jurisdiction [Member] | ||||||||
Valuation Allowance [Line Items] | ||||||||
Tax Credit Carryforward, Valuation Allowance | 100 | |||||||
Foreign Tax Credit [Domain] | ||||||||
Valuation Allowance [Line Items] | ||||||||
Tax Credit Carryforward, Valuation Allowance | $ 100 | |||||||
Prior Year Divestiture [Member] | ||||||||
Effective income tax rate reconciliation [Abstract] | ||||||||
Effective Income Tax Rate Reconciliation Adjustments To Reserves And Prior Years | 1900000000.00% | |||||||
[1] | Deferred tax benefit recognized does not reflect the impact of the Tax Act. See Note 17. |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating Loss Carryforwards [Line Items] | |||
Operating Loss Carryforwards | $ 176 | $ 180 | |
Deferred Tax Assets, Capital Loss Carryforwards | 3 | 3 | |
Net deferred tax assets (liabilities) [Abstract] | |||
Deferred Tax Assets, Tax Credit Carryforwards, Foreign | 230 | 266 | |
Employee benefits | 85 | 72 | |
Share-based compensation | 55 | 62 | |
Self-insured casualty claims | 6 | 7 | |
Lease related liabilities | 199 | 43 | |
Various liabilities | 43 | 43 | |
Deferred Tax Assets, Goodwill and Intangible Assets | 602 | 8 | |
Deferred Tax Assets, Property, Plant and Equipment | 21 | 19 | |
Deferred income and other | 85 | 45 | |
Gross deferred tax assets | 1,505 | 748 | |
Deferred tax asset valuation allowances | (787) | (454) | |
Net deferred tax assets | 718 | 294 | |
Intangible assets, including goodwill | (40) | (42) | |
Property, plant and equipment | (44) | (33) | |
Deferred Tax Liabilities Deemed Repatriation | (156) | 0 | |
Other | 31 | 31 | |
Gross deferred tax liabilities | (271) | (106) | |
Net deferred tax assets (liabilities) | 447 | 188 | |
Reported in Consolidated Balance Sheets as: | |||
Deferred Tax Assets, Net of Valuation Allowance, Current | 447 | 195 | |
Other liabilities and deferred credits | 0 | (7) | |
Net deferred tax assets (liabilities) | 447 | 188 | |
Total Operating and Capital Loss Carryforwards | 1,756 | ||
Income (Loss) from Continuing Operations before Income Taxes, Domestic | 466 | 726 | $ 662 |
Income (Loss) from Continuing Operations before Income Taxes, Foreign | 907 | 1,113 | 1,612 |
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | 1,373 | $ 1,839 | $ 2,274 |
Foreign [Member] | |||
Reported in Consolidated Balance Sheets as: | |||
Total Operating and Capital Loss Carryforwards | 408 | ||
State and Local Jurisdiction [Member] | |||
Reported in Consolidated Balance Sheets as: | |||
Total Operating and Capital Loss Carryforwards | 1,134 | ||
Internal Revenue Service (IRS) [Member] | |||
Reported in Consolidated Balance Sheets as: | |||
Total Operating and Capital Loss Carryforwards | $ 214 |
Income Taxes (Details 3)
Income Taxes (Details 3) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2019 | |
Operating and capital loss carryforwards [Line Items] | ||
Effective Income Tax Rate Reconciliation, Foreign Income Tax Rate Differential, Amount | $ 20 | |
Amount of operating and capital loss carryforwards due to expire in 2016 | $ 12 | |
Amount of operating and capital loss carryforwards due to expire between 2017 and 2020 | 173 | |
Amount of operating and capital loss carryforwards due to expire between 2021 and 2035 | 1,235 | |
Amount of operating and capital loss carryforwards which may be carried forward indefinitely | 336 | |
Total Operating and Capital Loss Carryforwards | 1,756 | |
Foreign [Member] | ||
Operating and capital loss carryforwards [Line Items] | ||
Amount of operating and capital loss carryforwards due to expire in 2016 | 10 | |
Amount of operating and capital loss carryforwards due to expire between 2017 and 2020 | 26 | |
Amount of operating and capital loss carryforwards due to expire between 2021 and 2035 | 36 | |
Amount of operating and capital loss carryforwards which may be carried forward indefinitely | 336 | |
Total Operating and Capital Loss Carryforwards | 408 | |
State and Local Jurisdiction [Member] | ||
Operating and capital loss carryforwards [Line Items] | ||
Amount of operating and capital loss carryforwards due to expire in 2016 | 2 | |
Amount of operating and capital loss carryforwards due to expire between 2017 and 2020 | 111 | |
Amount of operating and capital loss carryforwards due to expire between 2021 and 2035 | 1,021 | |
Amount of operating and capital loss carryforwards which may be carried forward indefinitely | 0 | |
Total Operating and Capital Loss Carryforwards | 1,134 | |
Internal Revenue Service (IRS) [Member] | ||
Operating and capital loss carryforwards [Line Items] | ||
Amount of operating and capital loss carryforwards due to expire in 2016 | 0 | |
Amount of operating and capital loss carryforwards due to expire between 2017 and 2020 | 36 | |
Amount of operating and capital loss carryforwards due to expire between 2021 and 2035 | 178 | |
Amount of operating and capital loss carryforwards which may be carried forward indefinitely | 0 | |
Total Operating and Capital Loss Carryforwards | $ 214 |
Income Taxes (Details 4)
Income Taxes (Details 4) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items] | |||
Unrecognized Tax Benefits | $ 188 | $ 113 | $ 100 |
Income Tax Examination, Penalties and Interest Accrued | 26 | $ 12 | |
Timing of Anticipated Impact [Domain] | |||
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items] | |||
Unrecognized Tax Benefits | $ 26 |
Income Taxes (Details 5)
Income Taxes (Details 5) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Examination [Line Items] | |||
Income Tax Examination, Penalties and Interest Expense | $ 13 | $ 2 | $ 5 |
Unrecognized tax benefits reconciliation [Roll Forward] | |||
Beginning of Year | 113 | 100 | |
Additions on tax positions related to the current year | 84 | 19 | |
Additions for tax positions of prior years | 54 | 0 | |
Reductions for tax positions of prior years | (30) | (5) | |
Reductions for settlements | (31) | 0 | |
Reductions due to statute expiration | (2) | (1) | |
Foreign currency translation adjustment | 0 | 0 | |
End of Year | $ 188 | $ 113 | $ 100 |
Income Taxes (Details 6)
Income Taxes (Details 6) - USD ($) | 12 Months Ended | ||||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2017 | |
Tax Act Enactment [Line Items] | |||||||
Unrecognized Tax Benefits, Decrease Resulting from Settlements with Taxing Authorities | $ 31,000,000 | $ 0 | |||||
Foreign Earnings Repatriated | 2.9 | ||||||
Total Operating and Capital Loss Carryforwards | $ 1,756,000,000 | ||||||
Effective Income Tax Rate Reconciliation, Foreign Income Tax Rate Differential, Amount | 20,000,000 | ||||||
Effective Income Tax Rate Reconciliation Adjustments To Reserves And Prior Years | 4.20% | 2.80% | 0.50% | ||||
Employee Service Share-based Compensation, Deferred Tax Benefit from Compensation Expense | $ 55,000,000 | 47,000,000 | $ 117,000,000 | ||||
Effective Income Tax Rate Reconciliation, Change in Deferred Tax Assets Valuation Allowance, Amount | 35,000,000 | ||||||
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | 373,000,000 | 78,000,000 | |||||
Tax Credit Carryforward, Valuation Allowance | 200,000,000 | $ 111,000,000 | 111,000,000 | $ 111,000,000 | $ 189,000,000 | 189,000,000 | $ 189,000,000 |
Deferred Tax Assets, Gross | 1,505,000,000 | 748,000,000 | 748,000,000 | 748,000,000 | |||
Deferred Tax Assets, Net | 447,000,000 | 188,000,000 | 188,000,000 | 188,000,000 | |||
Deferred Tax Assets, Tax Deferred Expense | $ 718,000,000 | $ 294,000,000 | 294,000,000 | $ 294,000,000 | |||
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Amount | 35,000,000 | 434,000,000 | |||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | 21.00% | 21.00% | 35.00% | 21.00% | ||
Limit on deductibility of interest expense | 30.00% | ||||||
Income tax provision | $ 79,000,000 | 297,000,000 | 934,000,000 | ||||
Unrecognized Tax Benefits | 188,000,000 | $ 113,000,000 | 113,000,000 | $ 113,000,000 | $ 100,000,000 | 100,000,000 | $ 100,000,000 |
Unrecognized Tax Benefits That Would Not Impact Effective Tax Rate | 8,000,000 | $ 10,000,000 | 10,000,000 | $ 10,000,000 | |||
Deferred Tax Assets, Changes in Judgement [Member] | |||||||
Tax Act Enactment [Line Items] | |||||||
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | 45,000,000 | ||||||
Deferred Tax Assets, Current Year Operations [Member] | |||||||
Tax Act Enactment [Line Items] | |||||||
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | 9,000,000 | ||||||
Deferred Compensation, Share-based Payments [Member] | |||||||
Tax Act Enactment [Line Items] | |||||||
Effective Income Tax Rate Reconciliation, Other Adjustments, Amount | 31,000,000 | ||||||
Prior Year Divestiture [Member] | |||||||
Tax Act Enactment [Line Items] | |||||||
Effective Income Tax Rate Reconciliation Adjustments To Reserves And Prior Years | 1900000000.00% | ||||||
Effective Income Tax Rate Reconciliation, Other Adjustments, Amount | 34,000,000 | ||||||
Repatriation Tax Liability [Member] | |||||||
Tax Act Enactment [Line Items] | |||||||
Income tax provision | 241,000,000 | ||||||
Remeasurement of Deferreds [Domain] | |||||||
Tax Act Enactment [Line Items] | |||||||
Income tax provision | 47,000,000 | ||||||
Foreign [Member] | |||||||
Tax Act Enactment [Line Items] | |||||||
Total Operating and Capital Loss Carryforwards | 408,000,000 | ||||||
State and Local Jurisdiction [Member] | |||||||
Tax Act Enactment [Line Items] | |||||||
Total Operating and Capital Loss Carryforwards | 1,134,000,000 | ||||||
Tax Credit Carryforward, Valuation Allowance | 100,000,000 | ||||||
Internal Revenue Service (IRS) [Member] | |||||||
Tax Act Enactment [Line Items] | |||||||
Total Operating and Capital Loss Carryforwards | 214,000,000 | ||||||
Foreign Tax Credit [Domain] | |||||||
Tax Act Enactment [Line Items] | |||||||
Tax Credit Carryforward, Valuation Allowance | 100,000,000 | ||||||
Tax Year 2018 [Member] | |||||||
Tax Act Enactment [Line Items] | |||||||
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | 156,000,000 | ||||||
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Amount | $ 399,000,000 | ||||||
Tax Year 2017 [Member] | |||||||
Tax Act Enactment [Line Items] | |||||||
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | $ 34,000,000 | ||||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 35.00% | ||||||
Non-UK [Member] | |||||||
Tax Act Enactment [Line Items] | |||||||
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | 7,000,000 | ||||||
Deferred Tax Assets, Gross | 13,000,000 | ||||||
Deferred Tax Assets, Net | 6,000,000 | ||||||
UNITED KINGDOM | |||||||
Tax Act Enactment [Line Items] | |||||||
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | 366,000,000 | ||||||
Deferred Tax Assets, Gross | 586,000,000 | ||||||
Deferred Tax Assets, Net | $ 220,000,000 |
Reportable Operating Segments_2
Reportable Operating Segments (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||
Total revenues | $ 1,694 | $ 1,339 | $ 1,310 | $ 1,254 | $ 1,558 | $ 1,391 | $ 1,368 | $ 1,371 | $ 5,597 | $ 5,688 | $ 5,878 | |||||||||||
Operating Profit | 546 | [1] | $ 480 | [1] | $ 471 | [1] | $ 433 | [1] | 741 | [2] | $ 553 | [2] | $ 449 | [2] | $ 553 | [2] | 1,930 | [1] | 2,296 | [2] | 2,761 | |
Investment Income, Net | [3] | (67) | 9 | 5 | ||||||||||||||||||
Other Pension (income) expense | [3],[4] | (4) | (14) | (47) | ||||||||||||||||||
Cost of Goods and Services Sold | 1,235 | 1,634 | 2,954 | |||||||||||||||||||
Interest Income (Expense), Net | [3] | (486) | (452) | (445) | ||||||||||||||||||
Depreciation and amortization | 112 | 137 | 253 | |||||||||||||||||||
Capital Spending | 196 | 234 | 318 | |||||||||||||||||||
Total Assets | [5] | 5,231 | 4,130 | 5,231 | 4,130 | |||||||||||||||||
Long-Lived Assets | [6] | 2,586 | 2,004 | 2,586 | 2,004 | |||||||||||||||||
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | 1,373 | 1,839 | 2,274 | |||||||||||||||||||
General and administrative expenses | 917 | 895 | 999 | |||||||||||||||||||
Costs associated with PH U.S. Acceleration Agreement | 25 | 25 | 39 | |||||||||||||||||||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Gain (Loss) Due to Settlement | (3) | |||||||||||||||||||||
KFC Global Division [Member] | ||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||
Total revenues | [7] | 2,491 | 2,644 | 3,110 | ||||||||||||||||||
Operating Profit | 1,052 | 959 | 981 | |||||||||||||||||||
Depreciation and amortization | 30 | 58 | 138 | |||||||||||||||||||
Capital Spending | 81 | 105 | 176 | |||||||||||||||||||
Total Assets | [5] | 2,042 | 1,481 | 2,042 | 1,481 | |||||||||||||||||
Long-Lived Assets | [6] | 1,179 | 868 | 1,179 | 868 | |||||||||||||||||
Pizza Hut Global Division [Member] | ||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||
Total revenues | [7] | 1,027 | 988 | 893 | ||||||||||||||||||
Operating Profit | 369 | 348 | 341 | |||||||||||||||||||
Depreciation and amortization | 15 | 10 | 26 | |||||||||||||||||||
Capital Spending | 33 | 38 | 42 | |||||||||||||||||||
Total Assets | [5] | 801 | 701 | 801 | 701 | |||||||||||||||||
Long-Lived Assets | [6] | 427 | 384 | 427 | 384 | |||||||||||||||||
Taco Bell Global Division [Member] | ||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||
Total revenues | [7] | 2,079 | 2,056 | 1,880 | ||||||||||||||||||
Operating Profit | 683 | 633 | 619 | |||||||||||||||||||
Depreciation and amortization | 59 | 61 | 82 | |||||||||||||||||||
Capital Spending | 76 | 85 | 95 | |||||||||||||||||||
Total Assets | [5] | 1,330 | 1,074 | 1,330 | 1,074 | |||||||||||||||||
Long-Lived Assets | [6] | 938 | 720 | 938 | 720 | |||||||||||||||||
Corporate and Other [Member] | ||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||
Total revenues | [3],[8] | 0 | 0 | (5) | ||||||||||||||||||
Franchise and property expenses | [3],[8] | (14) | (8) | (30) | ||||||||||||||||||
Cost of Goods and Services Sold | [3],[9] | 0 | 3 | 10 | ||||||||||||||||||
Revenue from Contract with Customer, Including Assessed Tax | [3],[8] | 0 | 0 | (5) | ||||||||||||||||||
Refranchising gain (loss) | [3] | 37 | 540 | 1,083 | ||||||||||||||||||
Other (income) expense | [3] | (9) | (8) | (8) | ||||||||||||||||||
Depreciation and amortization | 8 | 8 | 7 | |||||||||||||||||||
Capital Spending | 6 | 6 | 5 | |||||||||||||||||||
Total Assets | [5],[10] | 1,058 | 874 | 1,058 | 874 | |||||||||||||||||
Long-Lived Assets | [6] | 42 | 32 | 42 | 32 | |||||||||||||||||
General and administrative expenses | [3],[11] | (188) | (171) | (230) | ||||||||||||||||||
U.S. | ||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||
Total revenues | 3,000 | 2,900 | 2,800 | |||||||||||||||||||
Total Assets | $ 2,700 | $ 2,000 | 2,700 | 2,000 | ||||||||||||||||||
General and Administrative Expense [Member] | Corporate and Other [Member] | ||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||
Restructuring and Related Cost, Incurred Cost | 8 | 23 | ||||||||||||||||||||
Costs associated with PH U.S. Acceleration Agreement | 13 | |||||||||||||||||||||
United States | ||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Gain (Loss) Due to Settlement | [12] | (3) | 0 | (19) | ||||||||||||||||||
Pension data adjustment | [13] | 0 | 0 | 22 | ||||||||||||||||||
United States | Other pension (income) expense [Member] | ||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||
Pension data adjustment | 22 | |||||||||||||||||||||
Executive Income Deferral Plan [Member] | Mark-to-Market of YUM China Funds [Member] | ||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||
General and administrative expenses | $ 3 | 18 | 18 | |||||||||||||||||||
Executive Income Deferral Plan [Member] | Mark-to-Market of YUM China Funds [Member] | Corporate and Other [Member] | ||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||
General and administrative expenses | $ 3 | $ 18 | ||||||||||||||||||||
[1] | Includes net gains from refranchising initiatives of $6 million , $4 million , $8 million and $19 million in the first, second, third and fourth quarters, respectively. | |||||||||||||||||||||
[2] | Includes net gains from refranchising initiatives of $156 million , $29 million , $100 million and $255 million in the first, second, third and fourth quarters, respectively. | |||||||||||||||||||||
[3] | Amounts have not been allocated to any segment for performance reporting purposes. | |||||||||||||||||||||
[4] | Amounts in 2017 include a non-cash charge of $22 million related to the adjustment of certain historical deferred vested liability balances in our qualified U.S. plan. See Note 4. | |||||||||||||||||||||
[5] | U.S. identifiable assets included in the combined Corporate and KFC, Pizza Hut and Taco Bell Divisions totaled $2.7 billion and $2.0 billion in 2019 and 2018, respectively. | |||||||||||||||||||||
[6] | Includes PP&E, goodwill, intangible assets, net and in 2019, Operating lease right-of-use assets. | |||||||||||||||||||||
[7] | U.S. revenues included in the combined KFC, Pizza Hut and Taco Bell Divisions totaled $3.0 billion in 2019, $2.9 billion in 2018 and $2.8 billion in 2017. | |||||||||||||||||||||
[8] | Represents costs associated with the KFC U.S. Acceleration Agreement and Pizza Hut U.S. Transformation Agreement. See Note 4. | |||||||||||||||||||||
[9] | Represents depreciation reductions arising primarily from KFC restaurants that were held for sale. See Note 4. | |||||||||||||||||||||
[10] | Primarily includes cash, our Grubhub investment and deferred tax assets. | |||||||||||||||||||||
[11] | Amounts in 2018 include costs related to YUM's Strategic Transformation Initiatives of $8 million , partially offset by non-cash credits associated with modifications of share-based compensation awards of $3 million . Amounts in 2017 include costs related to YUM’s Strategic Transformation Initiatives of $21 million , non-cash charges associated with modifications of share-based compensation awards of $18 million and costs associated with the Pizza Hut U.S. Transformation Agreement of $13 million . See Note 4. | |||||||||||||||||||||
[12] | Settlement losses result when benefit payments exceed the sum of the service cost and interest cost within a plan during the year. These losses were recorded in Other pension (income) expense. | |||||||||||||||||||||
[13] | Reflects a non-cash, out-of-year charge related to the adjustment of certain historical deferred vested liability balances in the Plan during the first quarter of 2017 recorded in Other pension (income) expense. See Note 4. |
Contingencies (Details)
Contingencies (Details) - Property Lease Guarantee [Member] $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Guarantor Obligations [Line Items] | |
Year longest lease expires | 2065 |
Potential amount of undiscounted payments we could be required to make in the event of non-payment | $ 475 |
Present value of potential payments we could be required to make in the event of non-payment | $ 400 |
Contingencies (Details 3)
Contingencies (Details 3) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | ||
Unusual or Infrequent Item, or Both, Nature of Event or Transaction | On January 29, 2020, the Special Director issued an order imposing a penalty on YRIPL and certain former directors of approximately Indian Rupee 11 billion, or approximately $156 million. Of this amount, approximately $150 million relates to the alleged failure to invest a total of $80 million in India within an initial seven year period. We have been advised by external counsel that the order is flawed and that several options for appeal exist. We deny liability and intend to continue vigorously defending this matter. We do not consider the risk of any significant loss arising from this order to be probable. | |
Self Insured Property And Casualty Reserves [Member] | ||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | ||
Beginning balance | $ 66 | $ 84 |
Liability for Unpaid Claims and Claims Adjustment Expense, Period Increase (Decrease) | 9 | 11 |
Payments | (21) | (29) |
Ending balance | $ 54 | $ 66 |
Selected Quarterly Financial _3
Selected Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | 32 Months Ended | |||||||||||||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2019 | |||||||||||||
Fiscal Period Adjustment [Line Items] | ||||||||||||||||||||||||
Gain (Loss) on Disposition of Assets | $ 19 | $ 8 | $ 4 | $ 6 | $ 255 | $ 100 | $ 29 | $ 156 | $ 37 | $ 540 | $ 1,083 | |||||||||||||
Costs associated with PH U.S. Acceleration Agreement | 25 | 25 | 39 | |||||||||||||||||||||
Share-based Compensation Expense | 59 | 50 | [1] | 65 | [1] | |||||||||||||||||||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Gain (Loss) Due to Settlement | (3) | |||||||||||||||||||||||
Revenues | ||||||||||||||||||||||||
Total revenues | 1,694 | 1,339 | 1,310 | 1,254 | 1,558 | 1,391 | 1,368 | 1,371 | 5,597 | 5,688 | 5,878 | |||||||||||||
Restaurant Profit | 105 | 72 | 73 | 61 | 101 | 100 | 91 | 74 | 311 | 366 | ||||||||||||||
Operating Profit | 546 | [2] | 480 | [2] | 471 | [2] | 433 | [2] | 741 | [3] | 553 | [3] | 449 | [3] | 553 | [3] | 1,930 | [2] | 2,296 | [3] | 2,761 | |||
Income from continuing operations | $ 488 | $ 255 | $ 289 | $ 262 | 1,294 | |||||||||||||||||||
Net Income (loss) - YUM! Brands, Inc. | $ 334 | $ 454 | $ 321 | $ 433 | $ 1,294 | $ 1,542 | $ 1,340 | |||||||||||||||||
Basic Earnings Per Common Share (in dollars per share) | $ 1.61 | $ 0.83 | $ 0.94 | $ 0.85 | $ 1.07 | $ 1.43 | $ 0.99 | $ 1.30 | $ 4.23 | $ 4.80 | $ 3.86 | |||||||||||||
Diluted Earnings Per Common Share (in dollars per share) | 1.58 | 0.81 | 0.92 | 0.83 | 1.04 | 1.40 | 0.97 | 1.27 | 4.14 | 4.69 | 3.77 | |||||||||||||
Dividends Declared Per Common Share (in dollars per share) | $ 0.42 | $ 0.42 | $ 0.42 | $ 0.42 | $ 0.36 | $ 0.36 | $ 0.36 | $ 0.36 | $ 1.68 | $ 1.44 | $ 0.90 | |||||||||||||
Corporate and Other [Member] | ||||||||||||||||||||||||
Revenues | ||||||||||||||||||||||||
Revenue from Contract with Customer, Including Assessed Tax | [4],[5] | $ 0 | $ 0 | $ (5) | ||||||||||||||||||||
Total revenues | [4],[5] | 0 | 0 | (5) | ||||||||||||||||||||
General and Administrative Expense [Member] | Corporate and Other [Member] | ||||||||||||||||||||||||
Fiscal Period Adjustment [Line Items] | ||||||||||||||||||||||||
Restructuring and Related Cost, Incurred Cost | 8 | 23 | ||||||||||||||||||||||
Costs associated with PH U.S. Acceleration Agreement | 13 | |||||||||||||||||||||||
Franchise and property expenses [Member] | Corporate and Other [Member] | ||||||||||||||||||||||||
Fiscal Period Adjustment [Line Items] | ||||||||||||||||||||||||
Costs associated with PH U.S. Acceleration Agreement | 13 | 6 | 31 | $ 89 | ||||||||||||||||||||
Product [Member] | ||||||||||||||||||||||||
Revenues | ||||||||||||||||||||||||
Company sales | $ 490 | $ 364 | $ 359 | $ 333 | $ 477 | $ 499 | $ 512 | $ 512 | 1,546 | 2,000 | 3,572 | |||||||||||||
Product [Member] | United States | ||||||||||||||||||||||||
Revenues | ||||||||||||||||||||||||
Company sales | 1,014 | 1,143 | ||||||||||||||||||||||
Franchise and property revenue [Member] | ||||||||||||||||||||||||
Revenues | ||||||||||||||||||||||||
Company sales | 770 | 645 | 633 | 612 | 709 | 605 | 584 | 584 | 2,660 | 2,482 | 2,306 | |||||||||||||
Advertising [Member] | ||||||||||||||||||||||||
Revenues | ||||||||||||||||||||||||
Company sales | $ 434 | $ 330 | $ 318 | $ 309 | $ 372 | $ 287 | $ 272 | $ 275 | 1,391 | 1,206 | $ 0 | |||||||||||||
Advertising [Member] | United States | ||||||||||||||||||||||||
Revenues | ||||||||||||||||||||||||
Company sales | $ 811 | $ 706 | ||||||||||||||||||||||
[1] | Includes $3 million of appreciation and $18 million of depreciation in the market price of Yum China's stock in 2018 and 2017, respectively. See Note 4. | |||||||||||||||||||||||
[2] | Includes net gains from refranchising initiatives of $6 million , $4 million , $8 million and $19 million in the first, second, third and fourth quarters, respectively. | |||||||||||||||||||||||
[3] | Includes net gains from refranchising initiatives of $156 million , $29 million , $100 million and $255 million in the first, second, third and fourth quarters, respectively. | |||||||||||||||||||||||
[4] | Represents costs associated with the KFC U.S. Acceleration Agreement and Pizza Hut U.S. Transformation Agreement. See Note 4. | |||||||||||||||||||||||
[5] | Amounts have not been allocated to any segment for performance reporting purposes. |
Note 21. Subsequent Events Subs
Note 21. Subsequent Events Subsequent Events (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Subsequent Event [Line Items] | ||
Business Acquisition, Share Price | $ 14 | |
Business Combination, Consideration Transferred | $ 375 | $ 77 |
Business Combination, Consideration Transferred, Other | $ 53 |
Uncategorized Items - yum10k123
Label | Element | Value |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | us-gaap_CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents | $ 1,668,000,000 |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | us-gaap_CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents | 831,000,000 |
Equity [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | ||
Stockholders' Equity Attributable to Parent | us-gaap_StockholdersEquity | $ (2,000,000) |